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# TOPIC: QuestionEMV calculation question

## EMV calculation question 3 years 8 months ago #4250

 Ashwin Kini Topic Author Offline Fresh Boarder Posts: 16 Thank you received: 0 How is the following type of question calculated? If a business has 50% chances to earn \$5 million and 30% chances to lose \$2.5 million What is the EMV? Your e-mail address will never be displayed on the site. Check this box to be notified of replies to this topic. Note: BBcode and smileys are still usable.

## EMV calculation question 3 years 8 months ago #4251

 Cornelius Fichtner Online Administrator PrepCast Instructor Posts: 1119 Karma: 35 Thank you received: 185 Ashwin, Allow me to ask a question in return... where is this from and what do they say the answer is? Your e-mail address will never be displayed on the site. Check this box to be notified of replies to this topic. Note: BBcode and smileys are still usable. Until Next Time, Cornelius Fichtner, PMP, CSM President, OSP International LLC

## EMV calculation question 3 years 8 months ago #4252

 Ashwin Kini Topic Author Offline Fresh Boarder Posts: 16 Thank you received: 0 Hi Cornelius, I have found similar ones in few tests but unable to understand how the cost is calculated. The figures are updated so I wouldn't have the right answer. The rough calculation goes as follows:- EMV = (5 Million x 50%) + (-2.5 x 30%) = (2.5) + (Not sure how the cost is calculated here) Your e-mail address will never be displayed on the site. Check this box to be notified of replies to this topic. Note: BBcode and smileys are still usable.

## EMV calculation question 3 years 3 weeks ago #4991

 Suresh Lingam Visitor Hi, The calculation is very simple. Your Question :- If a business has 50% chances to earn \$5 million and 30% chances to lose \$2.5 million What is the EMV? Answer:- EMV = (50/100 * 5 million) + (30/100 * - 2.5 million) EMV = 2500000 + (-750000) EMV = 1750000 If you see I have take -2.5 million is the second part of the formula, because its a loss I hope this will clear your doubt. Your e-mail address will never be displayed on the site. Check this box to be notified of replies to this topic. Note: BBcode and smileys are still usable.
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