MODULE 2 - ACTIVITY 2.6 3 Based on payoff , the oil product option with the second highest EMV value (Oiier J) should be Ken's second choice to invest in. Assuming that Ken selects the Sub 100 oil product as a first choice , the second highest EMV value under the Oiler J 011 product will be used to calculate the new minimum figure for Sub 10 oil product in a favorable market .Applying the EMV formula , and substituting the known values , the payoff for a favorable market when investing in Sub 100 oil product is determined as follows FLU/Off PCB/Off meav *(LLunfav ) P *[Lfav}+i, fav EMV :6, alternative payOff L[Lfav)+l0.3 }*\\'7200,000'\\ 145,000=\\0.7 a, payOff i,(3fav)=205,000 I0.7 In; payofff =$292,857 _14 Therefore , with the resulting new payoff of $292 , 857.14 , Ken should consider another investment option if the payoff for Sub 100 is less than $292,857.14 Q. 322 Allen Young has always been proud of his personal investment strategies and has done very well over the past several years . He invests primarily in the stock market Over the past several months, however, Allen has become very concerned about the stock market as a good investment . In some cases it would have been better for Allen to have his money in a bank than in the market. During the next year, Allen must decide whether to invest $10,000 in the stock market or in a certificate of deposit (CD) at an interest rate of