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Carls brother owes him money Carl expects to receive $5000 from his brother two

Carl's brother owes him money. Carl expects to receive $5,000 from his brother two years from now. The interest rate is 10% and is expected to remain unchanged for the next two years. There is a 25% chance that Carl's brother will fail to pay him back. What is the expected value of the $5,000 Carl anticipates receiving in two years? Round your answer to the nearest dollar.

A. $2,491

B. $4,033

C. $3,099

D. $4,212

May 23 2018 Read more Less More

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