• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>

Expected Values.

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA APM Exams › Expected Values.

  • This topic has 2 replies, 2 voices, and was last updated 2 years ago by akka17bakka.
Viewing 3 posts - 1 through 3 (of 3 total)
  • Author
    Posts
  • September 30, 2020 at 6:18 pm #587071
    akka17bakka
    Member
    • Topics: 85
    • Replies: 80
    • ☆☆

    Hello Tutor,

    Could you kindly explain this statement please?

    ”The EV gives no indication of the dispersion of possible outcomes about the EV, i.e. the risk.”

    Thank you.

    September 30, 2020 at 6:30 pm #587074
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10224
    • ☆☆☆☆☆

    Situation 1. Outcome 1 = 5000 and p = 0.5; outcome 2 = 6000 and p = 0.5. EV = 5500

    Situation 2. Outcome 1 = 1000 and p = 0.5; outcome 2 = 10000 and p = 0.5. EV = 5500

    Both projects have the same expected income. But….

    If the project cost 4000 in situation 1 there is no prospect of a loss, so no serious risk (lowest income = 5000).

    In situation 2, however there is an evens chance of making a loss of 4000 – 1000 = 3000.

    Therefore a serious risk (perhaps fatal) of losing 3000.

    September 30, 2020 at 7:08 pm #587076
    akka17bakka
    Member
    • Topics: 85
    • Replies: 80
    • ☆☆

    Highly appreciate it, thank you so very much.

    God bless you.

  • Author
    Posts
Viewing 3 posts - 1 through 3 (of 3 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

ACCA News:

Changes to the SBL exam from September 2023

ACCA My Exam Performance for non-variant Applied Skills exams is available NOW

NEW! Download the ACCA Pass Guide

FREE Verifiable CPD for ACCA Members

ACCA mock exams and debrief videos

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

 

Donate

If you have benefited from OpenTuition please donate.

ACCA CBE 2023 Exams

Instant Poll * How was your exam, and what was the result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Specially for OpenTuition students

20% off BPP Books

Get BPP Discount Code

Latest comments

  • John Moffat on CAPM and MM Combined – ACCA Financial Management (FM)
  • Rana Nabeel on CAPM and MM Combined – ACCA Financial Management (FM)
  • John Moffat on Investment Appraisal Under Uncertainty: Sensitivity Analysis (example 1) – ACCA Financial Management (FM)
  • DIVIJ on Investment Appraisal Under Uncertainty: Sensitivity Analysis (example 1) – ACCA Financial Management (FM)
  • John Moffat on Interpretation of Financial Statements part a – ACCA Financial Accounting (FA) lectures

Copyright © 2023 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in


We use cookies to show you relevant advertising, find out more: Privacy Policy · Cookie Policy