Q 55

Cal has two choices.The first offers a 50% chance of winning $20 and a 50% chance of losing $20.The second option offers a 20% chance of winning $100 and an 80% chance of losing $20.Which choice has the larger expected value? A) Both choices have the same expected value,so Cal would be indifferent between the two options. B) The 50%-50% chance. C) Both choices have the same expected value but the 50%-50% is better because the chance of payoff is greater. D) The 20%-80% choice.

Multiple Choice