Here is the question.

2. A newly retired gentleman is thinking of investing his savings and is considering two different options. The first option (Option A) is an established practice and will earn him a return of 1 1,000 in the first year. The second option (Option B) is a new business and therefore it is difficult to accurately predict how much it will return it in the first year. The analysis show that there is a probability of 0.3 that the first year's return from Option B will be $25,000 and 0.3 probability that it will be $20,000. But there are also risks of no return or even $5,000 loss from investing in this business (Option B) with probabilities of 0.3 and 0.1, respectively. a) How much do you expect his first-year return from Option B to be? (2 marks) b) Which Option do you think is the more reasonable choice, only based on the first-year return (not future potentials)? Show your calculations and clearly explain the reason for your choice. (6 marks)