Mr. Merrill Lynch is planning on investing in stocks. He is considering three different types stocks, ABC, DEF, and XYZ to choose from under two possible states, good and bad. As a result of favorable stock mar- ket conditions, there is a 0.75 probability of good and 0.25 probability of bad state. The table below indi- cates the profits and losses of investing in the following three stocks under the given statesgood and bad.

sTOcKs

GOOD (0.75)

BAD (0.25)

ABC DEF XYZ

$75,000 $90,000 $35,000

$45,000 -$30,000 $15,000

Using Excel, set up a spreadsheet to find the best decision using: a. Maximax

b. Maximin

c. Equallikelihood

d. Expectedvalue