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-Andrew Has the Utility of Wealth Curve Shown in the Above

Question 44

Multiple Choice

-Andrew has the utility of wealth curve shown in the above figure. He owns an SUV worth $30,000, and that is his only wealth. There is a 10 percent chance that he will have an accident within a year. If he does have an accident, his SUV is worthless. What is Andrew's expected wealth? A) $30,000 B) $27,000 C) $20,000 D) zero
-Andrew has the utility of wealth curve shown in the above figure. He owns an SUV worth $30,000, and that is his only wealth. There is a 10 percent chance that he will have an accident within a year. If he does have an accident, his SUV is worthless. What is Andrew's expected wealth?


A) $30,000
B) $27,000
C) $20,000
D) zero

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