Jerry Tan is considering two mutually exclusive investments: Stock Alpha and Stock Beta. There are three equally likely outcomes for the economy: a recession, normal growth, and a boom. The...

Assuming that Jerry Tan is a risk-adverse investor, recommend which stock he should select for long term investment.

Extracted text: Jerry Tan is considering two mutually exclusive investments: Stock Alpha and Stock Beta. There are three equally likely outcomes for the economy: a recession, normal growth, and a boom. The probabilities of the three outcomes are equally likely, and the rate of return of Stock Alpha and Stock Beta are as follows: (a) Stock Alpha Stock Beta Outcome Return (%) Outcome Return (%) Recession 8 Recession 15 Normal Growth 20 Normal 20 Воom 25 Boom 40