(Scenario: Portfolio Selection for William) Use Scenario: Portfolio Selection for William. The probability that William will make a gain is _____ if he invests $1,000 in either Amazon or Oracle. The probability that he will make a gain is _____ if he invests $500 apiece in Amazon and in Oracle.
Scenario: Portfolio Selection for William
William is considering buying shares in two companies, Amazon and Oracle. If he invests $1,000 in Amazon, there is a 40% probability that at the end of the year his investment will be worth only $800 and a 60% probability that it will be worth $1,200. If he invests $500 in Amazon, there is a 40% probability that at the end of the year his investment will be worth $400 and a 60% probability that it will be worth $600. The corresponding numbers for investment in Oracle are identical.

Question

Quizplus · Accepted Answer

The Answer of (Scenario: Portfolio Selection for William) Use Scenario: Portfolio Selection for William. The probability that William will make a gain is _____ if he invests $1,000 in either Amazon or Oracle. The probability that he will make a gain is _____ if he invests $500 apiece in Amazon and in Oracle.
Scenario: Portfolio Selection for William
William is considering buying shares in two companies, Amazon and Oracle. If he invests $1,000 in Amazon, there is a 40% probability that at the end of the year his investment will be worth only $800 and a 60% probability that it will be worth $1,200. If he invests $500 in Amazon, there is a 40% probability that at the end of the year his investment will be worth $400 and a 60% probability that it will be worth $600. The corresponding numbers for investment in Oracle are identical.