You are analyzing two possible stock market investment strategies. For each of the following, identify whether or not it would be classified as a fair bet. Would a risk-averse person make either of these investments? Why or why not?

a. One strategy is to invest in a blue chip stock like Microsoft that has a proven track record. There is a 25% chance that the company continues its steady growth and your wealth increases by $30,000. There is a 75% chance that the company becomes unprofitable and your wealth decreases by $10,000.

b. Another strategy is to invest in a startup. There is a 10% chance that the company is a success and your wealth increases by $100,000. However, there is a 90% chance that the company fails and your wealth decreases by $20,000.