If we cannot estimate probabilities because the project cash flows are uncertain, then we can use all of the following methods except
A) minimax regret
B) maximin
C) maximax
D) EMV

Question

Quizplus · Accepted Answer

EMV (Expected Monetary Value) is a method that can be used to estimate probabilities by assigning probabilities to uncertain events and calculating the expected value of a project based on those probabilities. Therefore, it is not necessary to use EMV if we cannot estimate probabilities. On the other hand, the other options (minimax regret, maximin, maximax) do not rely on probabilities and can be used in situations where probabilities are uncertain.

If We Cannot Estimate Probabilities Because the Project Cash Flows