Explore BrainMass

Explore BrainMass

    Coefficient of Variation

    Not what you're looking for? Search our solutions OR ask your own Custom question.

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Bridget's Modeling Studios is considering opening in a new location in Miami.
    An aftertax cash flow of $120 per day (expected value) is projected for each of
    the two locations being evaluated.

    Which of these sites would you select based on the distribution of these cash
    flows (use the coefficient of variation as your measure of risk)?

    Site A Site B
    Probability Cash Flows Probability Cash Flows
    .15 $ 80 .10 $ 50
    .50 110 .20 80
    .30 140 .40 120
    .05 220 .20 160
    .10 190
    Expected value $120 Expected value $120

    © BrainMass Inc. brainmass.com March 4, 2021, 7:55 pm ad1c9bdddf


    Solution Summary

    The solution explains the calculation of Coefficient of Variation