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Problem 5. (15 points) Recall the Investment Wheel problem that was discussed in class. A simulation model was built to compare the performances of
Problem 5. (15 points) Recall the Investment Wheel problem that was discussed in class. A simulation model was built to compare the performances of three strategies. All three strategies are of the following form: in each round of the game, x% of all money is bet on the top sector, y% on the lower left sector, z% on the lower right sector, and the remaining is not bet on any of the three sectors. For Strategy 1: x=100, y=0, z=0. For Strategy 2: x=50, y=0, z=0. For Strategy 3: x=50, y=33.33, z=16.67. If you are allowed to choose any strategy of the above form, i.e., you can choose the value of x, y, and z freely, what is the optimal strategy that maximizes the expected long term return after 50 rounds.
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