Suppose That There Is a 50% Chance That an Investment

question 9

Multiple Choice

Suppose that there is a 50% chance that an investment of $1,000 rises in value to $1,200,and a 50% chance that the investment falls in value to $900.What is the expected return on the investment?

• A) -$100
• B) $50
• C) $100
• D) $200

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Definitions:

Careful

Being careful involves acting with thought and caution to avoid harm or mistakes.

Selective Perception

The method through which people filter media messages to align with their preferences, while disregarding any contradictory perspectives.

Systematic Attempt

A planned or organized effort to achieve a specific goal, often involving a methodical process.

Attribute

A quality or characteristic inherent to or ascribed to someone or something.