Discuss CIMA CIMAPRO19-P02-1 Exam Topic 8 Question 74

A manager must decide which one of three projects should be implemented. For each project the possible outcomes and their associated probabilities can be estimated reliably. The manager has decided to make the decision based solely on which project has the highest expected value of profit.

Which of the following statements are correct?

Select ALL that apply.

AThe manager will select the project with the lowest standard deviation.

BThe range of possible outcomes for each project is not important to the manager.

CThe decision is characterized by uncertainty and the manager is risk seeking.

DThe manager will select the project with the highest of all of the possible outcomes.

EThe decision is characterized by risk and the manager is risk neutral.

Suggested Answer: A

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41 comments · newest first

Mindy 11 months ago

E makes sense, risk neutral is the way to go in this scenario!

Jamika 11 months ago

Wait, how can the manager be risk seeking if they're just focusing on expected value?

Caren 12 months ago

I think the range of outcomes does matter, so B seems off.

Rima 12 months ago

Totally agree, option A is definitely incorrect!

Kris 1 year ago

The manager is looking for the highest expected value, not the lowest standard deviation.

Myrtie 1 year ago

I feel like the manager should be risk neutral if they're just looking at expected value, but I could be wrong about that.

Sanjuana 1 year ago

I practiced a similar question where the manager was risk-averse, so I'm a bit confused about the risk-seeking part here.

Brittney 1 year ago

I think the range of outcomes matters, especially since the manager is focusing on expected value.

Daniela 1 year ago

I remember discussing expected value in class, but I'm not sure if the manager will really pick the project with the lowest standard deviation.

Tashia 1 year ago

Okay, this seems straightforward. The manager is looking to maximize expected profit, so I'll need to calculate the expected value for each project and choose the one with the highest.MikeS: Hmm, I'm a bit confused about the difference between uncertainty and risk here. Is the manager risk-seeking or risk-neutral? That could impact the decision.SarahP: I think the key is to focus on the expected value, not the range of possible outcomes or the standard deviation. The manager just wants the project with the highest expected profit.TomW: Wait, I'm not sure about that last one. Isn't risk-neutrality different from uncertainty? I'll need to double-check my notes on that.LisaM: Okay, I've got this. Calculate the expected value for each project, compare them, and select the one with the highest. The other factors like standard deviation and range don't matter for this decision.

Shaun 1 year ago

Okay, I've got this. Calculate the expected value for each project, compare them, and select the one with the highest. The other factors like standard deviation and range don't matter for this decision.

Julian 1 year ago

Wait, I'm not sure about that last one. Isn't risk-neutrality different from uncertainty? I'll need to double-check my notes on that.

Barrett 1 year ago

I think the key is to focus on the expected value, not the range of possible outcomes or the standard deviation. The manager just wants the project with the highest expected profit.

Cathern 1 year ago

Hmm, I'm a bit confused about the difference between uncertainty and risk here. Is the manager risk-seeking or risk-neutral? That could impact the decision.

Kiera 1 year ago

Okay, this seems straightforward. The manager is looking to maximize expected profit, so I'll need to calculate the expected value for each project and choose the one with the highest.

Amie 1 year ago

This seems like a straightforward question about the responsibilities of a test analyst in a keyword-driven automation environment. I'll focus on identifying the key business processes that need to be tested.

Cecily 1 year ago

I'm a bit unsure here, but I think "Experience Targeting" could be the right answer since it lets you show different content to specific audience segments.

Darell 1 year ago

I'm leaning towards "None of the above," but I can't quite remember the specifics. This feels tricky!

Jerry 1 year ago

Aircrack-ng is for wireless network attacks, so that's not the best choice here. I think Shodan or Recon-ng would be the most effective tools to gather additional information about the physical security setup.

Gaynell 1 year ago

Wait, the manager can't just flip a coin to decide? Where's the fun in that?

Louvenia 1 year ago

What, no option for 'Throw a dart at the projects and see which one it hits'? That's a classic decision-making strategy!

Elly 1 year ago

The manager is making a decision under uncertainty, not risk. So option C is incorrect. E is the right answer here.

Sommer 1 year ago

↳ replying to Elly

I agree, the manager is making a decision under uncertainty, so option C is incorrect. E is the right answer.

Clorinda 1 year ago

↳ replying to Elly

E) The decision is characterized by risk and the manager is risk neutral.

Emilio 1 year ago

↳ replying to Elly

A) The manager will select the project with the lowest standard deviation.

Lenna 2 years ago

Haha, selecting the project with the highest possible outcome? That's like choosing the lottery ticket with the biggest jackpot. Option D is a bit too risky, don't you think?

Isaac 1 year ago

↳ replying to Lenna

Stefanie: So, maybe option E is the best choice then.

Mariann 1 year ago

↳ replying to Lenna

User 3: I think the manager should be risk neutral in this decision.

Stefanie 1 year ago

↳ replying to Lenna

User 2: Yeah, I think it's better to consider the standard deviation as well.

Elden 1 year ago

↳ replying to Lenna

User 1: I agree, choosing the project with the highest possible outcome seems risky.

Cyril 2 years ago

Wait, why would the manager choose the project with the lowest standard deviation? That's not what the question is asking for. Option A is clearly wrong.

Leonardo 1 year ago

↳ replying to Cyril

User 2: The decision is characterized by risk and the manager is risk neutral.

Leah 1 year ago

↳ replying to Cyril

User 1: The manager will select the project with the highest expected value of profit.

Darrel 2 years ago

But what about the standard deviation? Shouldn't the manager also consider that to assess the risk involved?

Sylvia 2 years ago

I agree with you, Johnna. It makes sense to go for the project that will bring in the most profit.

Johnna 2 years ago

I think the manager will select the project with the highest expected value of profit.

King 2 years ago

Hmm, the manager should focus on maximizing expected value, not minimizing risk. Option E seems the most appropriate.

Van 1 year ago

↳ replying to King

So, the manager is risk neutral in this decision-making process.

Chu 1 year ago

↳ replying to King

No, the manager will select the project with the highest possible outcomes, not the lowest standard deviation.

Antonio 1 year ago

↳ replying to King

But what about the standard deviation of the projects? Shouldn't that also be considered?

Lacey 1 year ago

↳ replying to King

I agree, option E is the best choice when maximizing expected value.

CIMAPRO19-P02-1 Exam - Topic 8 Question 74 Discussion