Lobster Liquidators will make $500,000 if the fishing season weather is good,$200,000 if the weather is fair,and would actually lose $50,000 if the weather is poor during the season.If the weather service gives a 40% probability of good weather,a 25% probability of fair weather,and a 35% probability of poor weather,what is the expected monetary value for Lobster Liquidators?

Question

Quizplus · Accepted Answer

Expected monetary value = (0.4 * $500,000) + (0.25 * $200,000) + (0.35 * -$50,000) = $232,500

Lobster Liquidators Will Make $500,000 If the Fishing Season Weather