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-The Above Figure Shows Bob's Utility Function

Question 6

Multiple Choice

-The above figure shows Bob's utility function.He currently has $100 of wealth,but there is a 50% chance that it could all be stolen.Over and above the price of fair insurance,what is the risk premium Bob would pay to eliminate the chance of theft? A) $0 B) $20 C) $30 D) $50
-The above figure shows Bob's utility function.He currently has $100 of wealth,but there is a 50% chance that it could all be stolen.Over and above the price of fair insurance,what is the risk premium Bob would pay to eliminate the chance of theft?


A) $0
B) $20
C) $30
D) $50

Correct Answer:

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