An investor is examining two business opportunities (see table below) where the profit varies based on inflation. Which option to you recommend she invest in?
Inflation Option A Option B Probability
Low $65,100 $125,400 0.15
Moderate $186,500 $254,500 0.45
High $115,000 $22,100 0.25
Very High ($35,200) ($51,000) 0.15
A. Option A because inflation is expected to be high
B. Option B because is has an expected profit of $131,210
C. Option A because it has an expected profit of $217,160
D. Option A because it has an expected profit of $117,160