How much Vera be willing to pay for perfect information

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Reference no: EM132752730

Question - Vera Wang is considering several business opportunities. She has gathered together the following information about the chances of success and possible outcome:

Favorable (s1) Unfavorable (s2)

Probability 60% 40%

Option 1 $31,500 $1,000

Option 2 $28,500 $1,500

Option 3 $26,500 $1,000

Option 4 $25,000 $1,250

How much should Vera be willing to pay for perfect information?

A. $200

B. $12,200

C. $19,300

D. $19,500

Reference no: EM132752730

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