Asked by stanley owuama on Jun 30, 2024

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An investment opportunity has two possible outcomes, and the value of the investment opportunity is $250. One outcome yields a $100 payoff and has a probability of 0.25. What is the probability of the other outcome?

A) 0
B) 0.25
C) 0.5
D) 0.75
E) 1.0

Outcome Yields

The results obtained from a particular action or set of circumstances, typically measured in terms of benefits, profits, or yields.

Investment Opportunity

A specific financial asset, product, or project that an individual, organization, or entity invests in with the expectation of generating a favorable future return.

  • Understand the basic concepts of probability and how it applies to investment decisions.
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ZK
Zybrea KnightJul 04, 2024
Final Answer :
D
Explanation :
The total probability of all possible outcomes must equal 1. Therefore, the probability of the other outcome is 1 - 0.25 = 0.75.