Allen Young has always been proud of his personal investment strategies and has done very well over the last several years. He invests primarily in the stock market. Over the last several monchs, however, Allen has become very concerned about the stock market as a good investment. In some eases, it would have been better for Allen to have his money in a bank than in stock market. During the next six months, Allen must decide whether to invest $1,000 in the stock market or in a six-meeth certificate of deposit (CD) at an interest rate of 10%6. If the market is good, Allen believes that he could get a 14%% return on his money. With a fair market, he expects to get an 8%6 return. If the market is bad, he will most likely get no returs at all in other words; the return would be 01%. Allen estimates that the probability of a good market is 0.4, the probability of a fair market is 04, and the probability of a bad market is 0.2, and he wishes to maximize his long-run average return,

(a). Develop a decision table for this problem.

(B). What is the best decision using EMV?

(C). What is the Maximax decision?

(D). What is the Maximin decision?

(E). Develop an opportunity loss table and best strategy.

(F) What is the equally likely decision?

(G). What is the criterion of realism decision? Use an a value of 8.

(H). What is the expected value of perfect information?

(I). What is Minimax decision?

(J). What type of decision is Allen facing?

(K). Under what circumstances is expected monetary value appropriate as a decision criterion? And isn't it appropriate?