In the forecast chart for the cumulative profit in year 3,you enter the value 0 into the left range box and hit the enter button.The above set of actions determines the ________.
A)percentage of risk that the NPV in the third year will not be positive
B)percentage of risk that the NPV in the third year will be positive
C)number of trials shown in the cumulative profit forecast chart for year 3
D)probability that the product will show a cumulative net profit in the third year

Question

Quizplus · Accepted Answer

Entering 0 in the left range box and hitting enter will show the probability that the product will show a cumulative net profit in the third year. This is because cumulative profit represents the net profit over time, and entering 0 in the left range box means starting from the beginning with no profit yet accumulated. Therefore, the chart will show the probability of reaching a positive net profit by the end of year 3.

In the Forecast Chart for the Cumulative Profit in Year