5. Expected Value SDA Company prepared the following probability distribution describing the relative likelihood of monthly sales volume levels and related profit (loss) for its lone product that sells for P 50 per unit: Profit (Loss) (P 70,000) 10,000 60,000 100,000 140,000 Sales volume Probability 10% 20% 40% 20% 10% 5,000 12,000 18,000 24,000 30,000 REQUIRED: Using the expected value approach, A) How much is the budgeted sales for the month? B) What is the expected value of the monthly profit?
5. Expected Value SDA Company prepared the following probability distribution describing the relative likelihood of monthly sales volume levels and related profit (loss) for its lone product that sells for P 50 per unit: Profit (Loss) (P 70,000) 10,000 60,000 100,000 140,000 Sales volume Probability 10% 20% 40% 20% 10% 5,000 12,000 18,000 24,000 30,000 REQUIRED: Using the expected value approach, A) How much is the budgeted sales for the month? B) What is the expected value of the monthly profit?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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