Business Decision Making: Expected Value Analysis
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Questions and Answers

What is the main decision the author is trying to make?

  • Whether to take a loan or borrow from friends
  • Whether to get a job or open a furniture shop (correct)
  • Whether to open a furniture shop or close it
  • Whether to invest in the stock market or real estate

    • What is the basis of the author's decision?

  • Expected value of each option (correct)
  • Personal preference
  • Risk tolerance
  • Availability of resources

    • What is the result of the author's decision analysis?

  • The expected value of the shop is higher than the job (correct)
  • The expected value of the job is higher than the shop
  • The expected values of both options are equal
  • The author is unable to make a decision

    • What type of decision-making technique is implied in the text?

    <p>Decision tree analysis</p> Signup and view all the answers

    What is the author's ultimate goal?

    <p>To make a decision based on expected value</p> Signup and view all the answers

    What is the main objective of the author?

    <p>To maximize expected value</p> Signup and view all the answers

    What is the author's preferred option?

    <p>Opening a furniture shop</p> Signup and view all the answers

    How did the author compare the options?

    <p>By calculating expected values</p> Signup and view all the answers

    What is the consequence of the author's decision?

    <p>The author will open a furniture shop</p> Signup and view all the answers

    What is the key factor that influenced the author's decision?

    <p>Expected value</p> Signup and view all the answers

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