WILL DEFINITELY UPVOTE

15

Below is a payoff table that lists four mortgage options. The numbers in the table represent borrowing costs. All the decision analysis questions that deal with mortgage options are based on this narration, i.e., you may reuse the model and the resulting solution to answer related questions. Outcome Decision Alternative Rates Rise Rates Stable Rates Fall 1-year ARM $66,645 $43,650 $36,560 3-year ARM $60,857 $45,698 $42,726 5-year ARM $55,895 $48,894 $46,134 30-year fixed $52,276 $52,276 $52,276 Which decision alternative is the best if the decision-maker thinks that all outcomes have equal chance of occurrence? A. 1-year ARM B. 3-year ARM C. 5-year ARM D. 30-year ARM