Sunny Side Condominiums recently purchased land outside of Phoenix and is
Trying to decide the size complex it should build (large or small). The following payoff
Table (in thousands of dollars) considers three possible levels of demand. If there is a
45% chance that the demand level will be low, 30% that it will be medium and 25%
Chance that it will be high, the expected value (in thousands of dollars) associated with
The best action is
A) $326.25
B) $310
C) $535
D) $208.75
E) $225

Question

Sunny Side Condominiums recently purchased land outside of Phoenix and is
Trying to decide the size complex it should build (large or small). The following payoff
Table (in thousands of dollars) considers three possible levels of demand. If there is a
45% chance that the demand level will be low, 30% that it will be medium and 25%
Chance that it will be high, the expected value (in thousands of dollars) associated with
The best action is 
A) $326.25 
B) $310 
C) $535 
D) $208.75 
E) $225

Quizplus · Accepted Answer

The Answer of Sunny Side Condominiums recently purchased land outside of Phoenix and is
Trying to decide the size complex it should build (large or small). The following payoff
Table (in thousands of dollars) considers three possible levels of demand. If there is a
45% chance that the demand level will be low, 30% that it will be medium and 25%
Chance that it will be high, the expected value (in thousands of dollars) associated with
The best action is 
A) $326.25 
B) $310 
C) $535 
D) $208.75 
E) $225

Sunny Side Condominiums Recently Purchased Land Outside of Phoenix and Is