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Question 5.A.14: Can you see a problem with producing an average figure? Look...

Can you see a problem with producing an average figure? Look back at Example 5.4. What strikes you about the average figure that has been calculated?

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An average figure may not be capable of actually occurring. This point was illustrated in Example 5.4 where the expected value of the net cash flows does not correspond to any of the stated options.

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