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Consider an investment with initial capital $2 000. The future value of this investment is random, denote it by X in thousand of dollars. We
Consider an investment with initial capital $2 000. The future value of this investment is random, denote it by X in thousand of dollars. We know the density function of X, which is the following
ct, 0 t 1,
c, 1 t 2,
-ct + 3c, 2 t 3,
0, otherwise.
(a) What is the probability that the investment will be profitable?
(b) What is the expectation of X?
(c) Based on these, should you invest money into this investment, or not?
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