How did we calculate ( 22 ) in the risk premium ?

Is is expected wealth 122 minus the current wealth 100 ?

RISK UNCERTAIN OUTCOMES (>1) W1- 150 Profit 50 W = 100 W2-80 Profit-20 E(W) pW1 +(1-p)W2-0.6 (150) +0.4(80) S2 = p[WI-E(W)]2 + (1-p) [W2-E(W)] 0.6 (150-122)2 0.4(80-122)2 1,176, S-v1 ,176,000 = 3 6-0 RISKY INVESTMENTS WITH RISK-FREE W1- 150 Profit- 50 Risky Inv 100 W2 = 80 Profit =-20 Risk Free T-bil_ Risk Premium- (22-5)- 17 E(risky investment) 122 Profit-5