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Help ASAP!!! Problem 5. Upon graduation, Sarah needs to decide between two choices: (1) Going for a 1-year MBA program, for which she estimates that

Help ASAP!!!

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Problem 5. Upon graduation, Sarah needs to decide between two choices: (1) Going for a 1-year MBA program, for which she estimates that she has a 70% chance of completing the MBA, leading to a 20% chance of getting (A) a Manager position and an 80% chance of getting (B) a Senior Staff position. However, if she fails the MBA program, she estimates that she has a 60% chance of getting (C ) an entry position and a 40% chance of (D) being jobless and deeply in debt. Sarah assigns a utility or degree of desirability of 1000 to the best outcome A and -1000 to the worst outcome D. (2) Taking an entry position which a year later will lead to a 50% chance of being promoted to a junior staff position (E) and a 50% chance of continuing at the entry position with seniority (F). From Homework 7, Sarah has already estimated the utility of the MBA program to be -124. For the other two outcomes E and F, Sarah has gone through the same mental experiment and obtains the following results: Problem 5a (5 points) She feels that the utility or degree of desirability of Outcome E is the same as that of a gamble in which she has a 30% probability of getting Outcome A and a 70% probability of getting Outcome D. Use this experiment to compute her expected utility or degree of desirability for Outcome E? Problem 5b (5 points) She feels that the utility or degree of desirability of Outcome F is the same as that of a gamble in which she has a 20% probability of getting Outcome A and an 80% probability of getting Outcome D. Use this experiment to compute her expected utility or degree of desirability for Outcome F? Problem 5c (20 points) Given all the information on the probabilities and expected utilities of the outcomes, compute the utility of the Entry Position (2) and compare it with the utility of the MBA program (1) to determine which choice Sarah should take after graduation

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