Consider a risky portfolio. The end$-$of$-$year cash $$ow derived from the portfolio will be

either $$50,000$ with probability $0\mathrm{.}6$ or $$150,000$ with probability $0\mathrm{.}4.$ The alternative

riskless investment in T$-$bill pays $4\%.$ This risky portfolio is currently selling $($asking

price$)$ for $$80,000$