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Should wilson motors borrow the money

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Question - Wilson Motors is looking to expand its operations by adding a second manufacturing location. If it is successful, the company will make $460,000. If it fails, the company will lose $270,000. Wilson Motors is trying to decide whether it should borrow the $270,000 given the current bank loan rate of 15%. Should Wilson Motors borrow the money if

a. the probability of success is 95%?

b. the probability of success is 78%?

c. the probability of success is 74%?

Reference no: EM133157155

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