As the of their investment startegy, the Carringtons have decided to put $100,000 into stuck market investment and also into purchasing precious metals. The performance of the investments depends on the state of the economy in the next
year. In an expanding economy, it is expected that their stock market investment will outperform their investment in
precious metals, whereas an economic recession will have precisely the opposite effect. Suppose the following payoff
matrix gives the expected percentage increase or decrease in the value of each investment for each state of the economy.
Expanding economy Economic recession
Stock market investment [25 -10]
Commodity investment [ 10 20]
a) Determine the optimal investment strategy for the Carringtons' investment of $100,000.
stocks $____
commodities $_____