Find smallest value of p for which owner will take risk

Reference no: EM13142474

suppose the owner of a salvage company is considering raising a sunken ship. I successful, the venture will yield a net profit of $10 million. Otherwise, the owner will lose $ 4million. Assume the owner is willing to take the risk to go ahead with this project, provided the expected net profit is $500,000. (a) construct a probability distribution table. (b) if p=0.4, find the expected net profit. (c) what is the smallest value of P for which the owner will take the risk to undertake this project?

Reference no: EM13142474

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