Calculate the expected value and standard deviation

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Reference no: EM13232911

A firm is considering two alternative projects. Project A needs an investment of $800,000. Project B needs an investment of $750,000. Relevant annual cash flow data for the two projects over their expected seven-year lives are as follows:

PROJECT A PROJECT B

probability: cash flow: probability: cash flow:
0.50 $0 0.045 $0
0.50 $500,000 0.910 $200,000
0.045 $400,000

Calculate the expected value, standard deviation, and coefficient of variation of cash flows for each project

Reference no: EM13232911

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