Why won’t my boss approve my project? I’ve done the math – it’s a good investment. Because it isn’t good enough. We learn the math and rationale behind these decisions in this article.
Definition of Expected Value
Understanding the expected value of a possible future event allows us to make mathematically sound decisions. We can decide if we want to make an investment. We can assign a reasonable price for our services. We can prioritize requirements. Expected value is a calculation that should be used when calculating ROI.