Expected value refers to the
A)Future value of a current payment.
B)Present value of a future payment.
C)Probable value of a future payment,including the risk of nonpayment.
D)Difference in the rates of return on risky and safe investments.

Question

Quizplus · Accepted Answer

Expected value refers to the probable value of a future payment, taking into account the risk of nonpayment. It is used in decision-making to determine the potential value of an investment or action. It is calculated by multiplying the probability of each potential outcome by its respective value and summing the results.

Expected Value Refers to the