Quality $($Pty$)$ Ltd$,("$Quality$")$ uses a third$-$party for the packaging of Quality's products.

The current average cost per packaging is R$124.$ Quality is trying to decide whether

to establish an in$-$house packaging service. A number of factors could affect the

average total cost per packaging for the in$-$house service. The table below shows the

possible average total costs and the probability of each one occurring.

The expected value of the average total cost, based on the probability distribution

above is $R126\mathrm{.}36.$

REQUIRED:

Explain the decision that the management of Quality $($Pty$)$ Ltd is likely to make, based

on the probability distribution and the current packaging cost of R$124$ per packaging,

if the management is:

$($a$)$ Risk neutral

$($b$)$ Risk averse

$($c$)$ Risk seeker

Round your answers to two decimal places where required.