Problem 75d

Given information

A venture capitalist, willing to invest $, has three investments to choose from. The first investment, a software company, has a % chance of returning $   profit, a % chance of returning $1,000,000 profit, and a % chance of losing the million dollars. The second company, a hardware company, has a 20% chance of returning $   profit, a % chance of returning $ profit, and a % chance of losing the million dollars. The third company, a biotech firm, has a 10% chance of returning $ profit, a % of no profit or loss, and a % chance of losing the million dollars.

Step-by-step explanation

Formula Used:

Since, expected value for software company would be:

Software company

Expected value for hardware company would be:

Hardware company

Expected value for Biotech firm would be:

Biotech firm