Refer to the table below.A particular stock market investment strategy has the following possible outcomes:
(A)What is the expected return from this stock market investment strategy?
(B)Would you choose this expected return or take a safe return of either 8 percent from a U.S.Treasury bill or 6 percent from a savings deposit at a bank? Why?
(C)Suppose your grandfather tells you he would choose a safe return of 7 percent from a bank over the above stock-market investment strategy.Is he risk-averse? Explain.
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