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Assumptions what should the investor do

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Reference no: EM132024900

An Investor has 100000$ to invest this year. One option is to purchase a guaranteed investment certificate with a 1.8% yield. Another option is to purchase a risky stock. The investor believes that the stock will increase by 5% with probability 0.7, and will decrease by 3% with probability 0.3. Based on these assumptions what should the investor do.

Reference no: EM132024900

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