Question

Sharon is given two options. Option 1 allows her to take $5. Option 2 allows her a 1/3 chance of winning $50, but she risks losing $10, 2/3 of the time. What best describes sharon?.

Answer 1

Sharon is smart in theory because she looses 10 2/3 and the other 1/3 she wins the 50$ so she makes 40$ per investment rather then only making the 5$ without the "risk"