Are the following true false or uncertain? Explain why.a. (7 points) Many people

Are the following true false or uncertain? Explain why.a. (7 points) Many people buy insurance against their home
burning down and also purchase lottery tickets for large prizes. (The insurance
and lottery tickets both have negative expected value.)These people cannot be maximizing the expected utility of
their wealth.b. (7 points) Jenna owns $5000 worth of Microsoft stock and
no other stocks. She is deciding whether to invest another $5000 from her chequing
account in General Electric stock. If Jenna is risk averse she should buy the
General Electric stock in order to diversify her portfolio.