We learned in this chapter that one idea re-searchers have tested was that when forced to make a decision, people choose the alternative that yields the highest expected value.
a. If that were the case, explain which of the following two choices people would make: Choice A: Accept a gift of $ 10. Choice B: Take a gamble with probability 1/1000 of winning $ 9000 and 999/ 1000 of winning nothing.
b. Using the material from Chapter 16, explain which of the two choices in part (a) you think the majority of people would select.