The formula to calculate Expected Monetary Value (EMV) is:
\[ \text{EMV} = \text{Probability of Occurrence} \times \text{Impact of Occurrence} \]
The Expected Monetary Value (EMV) is a crucial metric in project management and decision-making. It helps estimate the potential financial impact of risk events by multiplying the probability of the event occurring by its financial impact.
Let's consider a scenario:
To calculate the EMV:
\[ \text{EMV} = 0.2 \times 50,000 = 10,000 \]
Therefore, the Expected Monetary Value (EMV) is $10,000.
