Your client wants your advice on which of two alternatives he should choose

Your client wants your advice on which of two alternatives he should choose. One alternative is to sell an investment now for $10,000. Another alternative is to hold the investment three days, after which he can sell it for a certain selling price based on the following probabilities:

Selling Price

Probability

$ 5,000

.4

8,000

.2

12,000

.3

30,000

.1

Required:

Would you recommend selling the investment now or hold the investment for three days?

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