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The diagram shows the final wealth and utility levels provided by a bet of an investor with initial wealth, W = 1 and initial

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The diagram shows the final wealth and utility levels provided by a bet of an investor with initial wealth, W = 1 and initial utility, U = 0.5: WH= 4 p=0.25 U = 2 Wo =1 Uo= 0.5 p=0.75 WL= 0 = 0 Which of these statements are correct? I. The final levels are, E(W) = 1 & E(U) = 0.5. II. The investor is risk-neutral. A. I. only. B. II. only C. I. & II. C. I. & II. D. none of them.

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