Ray Crofford Is Evaluating Investment Alternatives for the $100,000 Which

question 21

Multiple Choice

Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather.His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities,and (2) the advisor's track record on predicting Bull and Bear markets: If the advisor predicts a Bear market the revised probability of a Bear market,P (S₂|F₂) ,is ___.

• A)0.524
• B)0.636
• C)0.784
• D)0.812
• E)0.000

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Definitions:

Instrumental

Pertaining to actions or objects that serve as means to an end, often referring to the practical or functional use of something.

Expressive Roles

Roles associated with emotional support, nurturance, and maintaining interpersonal relationships within the family or group.

Social Learning Theory

A theory in psychology that proposes that new behaviors can be acquired by observing and imitating others.

Cognitive Development Theory

A theory that describes how human beings acquire, construct, and use knowledge as they grow and develop.