The above figure shows Bob's utility function. He currently has $100 of wealth, but there is a 50% chance that it could all be stolen
The midpoint of the chord that runs from zero and intersects the utility function where wealth is 100, represents Bob's A) risk premium.
B) expected utility of receiving $50 with certainty.
C) expected utility of receiving $0 50% of the time and $100 50% of the time.
D) risk neutrality.
C
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A bank has deposits of $100,000, reserves of $20,000, and loans of $80,000. If the desired reserve ratio is 10 percent, then its excess reserves are
A) 0. B) $8,000. C) $10,000. D) $2,000. E) $12,000.
Explain the difference between human needs and wants
What will be an ideal response?
Which curve in the market for foreign-currency exchange shifts and which direction does it shift if the government budget deficit increases? Explain why an increase in the budget deficit shifts this curve
The demand for reserves increases as the price level rises because
A. people want money to buy goods that will appreciate with inflation. B. people need more money to finance transactions. C. the opportunity cost of holding money increases. D. higher prices reduce the value of dollar assets.