Multiple Choice
If Ann's utility function is U =3W⁰.⁵,and she invests in a business which can yield $6,400 with probability 1/5,and $3600 with probability 4/5,then her Arrow-Pratt measure of risk aversion is
A) 0.5/w.
B) 1/w.
C) 1.5w.
D) 3/w.
Correct Answer:
Verified
Correct Answer:
Verified
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