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I need Answer as soon as possible please Question BI (17%): a) Ahmed has $5000 in cash and faces the following two alternatives during the

I need Answer as soon as possible please

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Question BI (17%): a) Ahmed has $5000 in cash and faces the following two alternatives during the pandemic: . Keep $5000 in a current account (interest free) . Or buy a stock with 50/50 distribution for 2.2% return or 1.4% loss Ahmed is loss averse and his value function over gains or losses z is: i) Suppose 2 =2.1. Write down Ahmed's valuation if he decides to invest all $5000 into the stock for one year? Which investment strategy looks more desirable? (5%) ii) What is Ahmed's valuation of the stock option over two years? Assume that the performance of the stock is consistent across these two years. (5%) b) Please use the most appropriate theory to discuss the above investor's behaviour. (7%)

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