Project and chooses either safe or risky

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A bank has $8 that it has raised from depositors, and has promised to pay them back $8. The bank invests the $8 in a project and chooses either safe or risky. If the bank chooses safe, the revenue is $10 with probability 1. If the bank chooses risky, the revenue is $12 with probability 0.5 and $4 with probability 0.5. In this case, if the bank selects safe, the payoff for the bank is ____ and if the bank chooses risky, the exp. payoff is ____.

Reference no: EM131713931

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