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Harry works as a project manager for the NHQ Project. He is performing quantitative risk analysis for his project. One of the project risks has a 40 percent probability of happening, and it will cost the project $65,000 if the risk happens. What is the expected monetary value of this risk event?
Suggested Answer: A
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12 comments · newest first
LE
Leah
1 year ago
Zero seems off; we need to factor in the probability!
VA
Vallie
1 year ago
I thought we only consider costs if the risk happens.
MA
Marylou
1 year ago
Wait, how can it be negative? That doesn't add up.
NI
Nickolas
1 year ago
Definitely going with $27,000! Makes sense.
BR
Brett
1 year ago
The expected monetary value is calculated as 0.4 * $65,000.
CA
Carlota
1 year ago
I’m confused about the options. If the risk hasn’t occurred yet, does that mean the expected value is zero? But I feel like it should be calculated anyway.
PH
Phuong
1 year ago
I practiced a similar question, and I think the expected value is just the cost times the probability, which would give us a positive number, right?
MI
Micah
1 year ago
I’m not entirely sure, but I remember something about negative values in risk analysis. Could it be negative $26,000?
NA
Natalie
1 year ago
I think the expected monetary value is calculated by multiplying the probability by the cost, so it should be 0.4 times $65,000.
KA
Kathrine
1 year ago
Hmm, I'm a bit unsure about this one. I'll need to think it through carefully. The question mentions the servers should only be able to reach the client through the ADC, so maybe Direct server return or Transparent mode would be better options.
TI
Timmy
1 year ago
I'm a little confused by the wording of the question. Can someone explain what they mean by "typical lot quantity"?
SO
Sommer
1 year ago
Ugh, I can never remember that one. Let me think... is it the tilde or the caret?