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I have trouble understanding the solution mentioned in the end of June 2010 Q1 answer a “for example, the expected value closing balance of 2.1 m is not forecast to occur , while a closing balance of 3.5 m is likely to occur.”
The actual closing balance will either be 7,500 or 3,500 or (2,500) – it will be one of those three.
It will never be the expected value of 2,100.
It is quite likely to be 3,500 because the probability of it being that is 0.6 which is much higher than either of the other two possibilities.
Thanks, I got it.