The following payoff table shows profits for two decision alternatives under three different states of nature. It is known that the probability of the occurrence of state of nature 1 is 0.1. 
a.What should the probabilities of states of nature 2 and 3 be so that the expected values of the two decision alternatives equal one another?
b.Determine the expected values.
Definitions:
Discount Rate
The interest rate used in discounted cash flow analysis to determine the present value of future cash flows.
Lag Strategy
A deliberate decision to not be a first mover in an industry or market, observing and reacting to competitors' actions.
Straddle Strategy
A trading strategy that involves purchasing both a call option and a put option for the same underlying asset, with the same strike price and expiration date, allowing investors to benefit from significant price movements in either direction.
Leading Strategy
A forward-thinking approach in business or military operations that involves taking proactive measures to achieve a competitive advantage or fulfill objectives.
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