[adielena]

Hi John,

I am a bit confused with this question.

Looking at line 1:
We have the discounted PV of 893 for year 1, discounted PV of 1594 for year 2 – hence a total PV of 2487.
A probability of 0.1 for year 1 and 0.3 for year 2 – so a joint probability of 0.03

The PV * JP = 2487 * 0.03 = 74.6

My question is: where is the NPV of (1013) coming from?
I tried all combinations, and cannot figure it out.

Thank you in advance

[adielena]

Passed with 54, 4th time.
I was sick of this one!

SO, thank you Open Tuition 😀

[adielena]

Can you please help me figure out the sales mix variance and sales quantity variance for this question?

Thank you

[Author]

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