Which of the following is the equation for determining an expected value?

Question

Quizplus · Accepted Answer

The equation for determining an expected value is (1 - Risk factor) x PDV, which calculates the probability-weighted average of all possible outcomes. This formula takes into account the risk factor, which represents the likelihood of the expected outcome occurring, and the present discounted value (PDV) of the expected cash flows. Option A correctly captures this formula by multiplying the risk factor by the PDV and subtracting it from 1.

Which of the Following Is the Equation for Determining an Expected