Question: Place-Plus, a real estate development firm, is considering several alternative development projects. These include building and leasing an office park, purchasing a parcel of land and building an office building to rent, buying and leasing a warehouse, building a strip mall, and building and selling condominiums. The financial success of these projects depends on interest rate movement in the next five years. The various development projects and their five-year financial return ($ millions) given that interest rates will decline, remain stable, or increase are shown in the following payoff table.

Project Decline Stable Increase

Office park 0.5 1.7 4.5

Office building 1.5 1.9 2.5

Warehouse 1.7 1.4 1.0

Mall 0.7 2.4 3.6

Condominiums 3.2 1.5 0.6

Determine the best investment using the following decision criteria.

c. Equal likelihood

d. Hurwicz (alpha = 0.3)