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The Following Statements About Excepted Utility Theory Are All Equivalent 0,xCE=00, x_{C E}=0

Question 8

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The following statements about excepted utility theory are all equivalent except:


A) For all gambles an individual's certainty equivalent equals 0,xCE=00, x_{C E}=0
B) E(u(x) ) =u(E(x) ) \mathrm{E}(\mathrm{u}(\mathrm{x}) ) =\mathrm{u}(\mathrm{E}(\mathrm{x}) )
C) The individual is risk averse.
D) The individual is risk-neutral.

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