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(Table: Natasha's Total Utility) Look at the Table Natasha's Total

Question 122

Multiple Choice

(Table: Natasha's Total Utility) Look at the table Natasha's Total Utility.Natasha earns $50,000
Per year but faces losing $20,000 of it if she is late with her work.If there is a 25% probability that Natasha will be late with her work and her income will equal $30,000, Natasha would be willing to pay for insurance to eliminate the uncertainty in her income.Natasha wants
A guaranteed income of $50,000.


A) $4,000
B) $5,000
C) $7,500
D) $9,500

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