Multiple Choice
An individual is uncertain whether to bet on a football game.He believes that the probability of his team winning is 40%.If his team wins,he will receive $180.If his team loses,he'll pay $130.If the decision is made based exclusively on the expected value criterion,then the individual will:
A) not take the bet if he is a risk-lover.
B) not take the bet if he is risk-neutral.
C) take the bet only if he is risk-neutral.
D) take the bet only if he is risk-averse.
E) not take the bet if he is risk-averse.
Correct Answer:
Verified
Correct Answer:
Verified
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