Your company wants to decide between Investment A, which will cost $100K upfront, and Investment B, which will cost $150K upfront. If the economy performs well, Investment A will bring in $750K for your company, but if the economy performs poorly, then it will lose $250K for your company. If the economy performs well, Investment B will bring in $850K for your company, but if the economy performs poorly, then it will lose $300K for your company. Theres a 60% chance of a strong market and a 40% chance of a weak market.

a. What is the EMV of Investment A?

b. Additionally, discuss the relationship between the strong market-weak market dynamic and the expected difference in performance between Investment A and Investment B.

c. If the EMB of Investment B increases to $260K what would be your best course of action?