An investor has $1000 to invest in speculative stocks. He is considering investing m dollars in stock A and XXXXXXXXXXm) dollars in stock B. An investment in stock A has a 0.6 chance of doubling in...

An investor has $1000 to invest in speculative stocks. He is considering investing m dollars in stock A and (1000 - m) dollars in stock B. An investment in stock A has a 0.6 chance of doubling in value, and a 0.4 chance of being lost. An investment in stock B has a 0.7 chance of doubling in value, and a 0.3 chance of being lost. The investor's utility function for a change in fortune, x, is

(a) What is @l (for a fixed m)? (It consists of four elements.)

(b) What is the optimal value of m in terms of expected utility?