An investment opportunity has two possible outcomes, and the value of the investment opportunity is $250. One outcome yields a $100 payoff and has a probability of 0.25. What is the probability of the other outcome?
A) 0
B) 0.25
C) 0.5
D) 0.75
E) 1.0

Question

Quizplus · Accepted Answer

The total probability of all possible outcomes must equal 1. Therefore, the probability of the other outcome is 1 - 0.25 = 0.75.

An Investment Opportunity Has Two Possible Outcomes, and the Value