Question: Amanda is considering whether to put $ 1 , 0 0 0 in her savings account at an annual interest rate of 1 percent or

Amanda is considering whether to put $1,000 in her savings account at an annual interest rate of 1 percent or purchase $1,000 worth of stock in BigCorp. If she puts $1,000 in her saving account, then at the end of the year, she'll have $1,010 for certain. If she buys stock in BigCorp, then at the end of the year, there's a 20 percent chance she'll have $1,200, a 40 percent chance she'll have $1,000, and a 40 percent chance she'll have $900.
If Amanda is risk averse, then she will
put $1,000 in her savings account.
put some of her money in savings and use the rest to buy stock in BigCorp.
purchase $1,000 worth of stock in BigCorp.
Amanda is considering whether to put $ 1 , 0 0 0

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