Suppose that, in an experimental setting, 100 students are asked to choose between Gamble A and Gamble B, where:

Gamble A: The student will receive $10 million with a 100% probability.

Gamble B: The student will receive $5 million with a 45% probability, $15 million with a 40% probability, and $0 million (nothing) with a 15% probability.

A risk-neutral student is:

a.

likely to choose Gamble B because the student will win something (as opposed to nothing) with a higher probability.

b.

likely to choose Gamble B because it has a higher expected value.

c.

indifferent toward Gambles A and B because they have the same expected value.

d.

likely to choose Gamble A because the student will win something (as opposed to nothing) with a higher probability.

e.

likely to choose Gamble A because it has a higher expected value.