- Mr. Ali has invested in two stocks, PSO and P & G. Mr. Ali has determined that the possible outcomes of these investments three months from now are as follows. Calculate the different
outcomes of net profits and losses by using the tree diagram. Also calculate the net gains and losses from
these investments by applying the subjective method of probability assignments.

Economic models a. are constructed to mirror reality as closely as possible, and in this respect economic models are no different from other scientific models. b. are constructed to mirror reality as closely as possible, and in this respect economic models are very different from other scientific models. c. are simplifications of reality, and in this respect economic models are no different from other scientific models. d. are simplifications of reality, and in this respect economic models are very different from other scientific models.