Which of the following statements is likely to be correct for a decision tree which indicates a 30 percent chance of making a $250,000 profit and a 70 percent chance of sustaining a $140,000 loss?
A) the expected value is negative before discounting.
B) the expected value is positive before discounting.
C) the decision should be "yes" whenever the amount of possible profit exceeds the amount of possible loss.
D) the decision should be "no" whenever there is a possibility of loss.
Answer: A) the expected value is negative before discounting.
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