Your client wants your advice on which of two alternatives he should choose. One alternative is to sell an investment now for $10,000. Another alternative is to hold the investment three days, after which he can sell it for a certain selling price based on the following probabilities:
Selling Price
Probability
$ 5,000
.4
8,000
.2
12,000
.3
30,000
.1
Required:
Would you recommend selling the investment now or hold the investment for three days?