Your IT consulting company is trying to decide which of four projects to bid. Information on each is in the table below. Assume that all up-front investments are not recovered, so they are shown as negative profits. Draw a diagram and calculate the expected monetary value (EMV) for each project. Write a paragraph explaining which project(s) you would choose to bid.
Project
Chance of
Outcome
Estimated
Profit
Project 1
50%
50%
$120,000
-$50,000
Project 2
30%
40%
30%
$100,000
$50,000
-$60,000
Project 3
70%
30%
$20,000
-$5,000
Project 4
30%
30%
20%
20%
$40,000
$30,000
$20,000
-$50,000
