Beatrix has $109 of wealth. She is contemplating a gamble th

Homework Assistance Economics Beatrix has $109 of wealth. She is contemplating a gamble th

Economics

Beatrix has $109 of wealth. She is contemplating a gamble th

Beatrix has $109 of wealth. She is contemplating a gamble that gives her a 0.25 probability of winni… Show more Beatrix has $109 of wealth. She is contemplating a gamble that gives her a 0.25 probability of winning $180 and a 0.75 probability of losing $60. Her utility function is: U(M) = ln(M) 2.1. [10points] Which is the expected value of her wealth? 2.2. [10points] Which is the expected utility of wealth? 2.3. [10points] Is Beatrix risk averse? Explain you answer using a graph. • Show less

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