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-John's Utility of Wealth Curve Is Shown in the Above

Question 180

Multiple Choice

-John's utility of wealth curve is shown in the above figure. He currently has wealth of $20,000 and there is a 10 percent chance of losing it all. John is A) willing to pay any price for insurance. B) willing to pay no more than $2,000 for insurance. C) willing to pay no more than $3,000 for insurance. D) willing to pay $5,000 for insurance.
-John's utility of wealth curve is shown in the above figure. He currently has wealth of $20,000 and there is a 10 percent chance of losing it all. John is


A) willing to pay any price for insurance.
B) willing to pay no more than $2,000 for insurance.
C) willing to pay no more than $3,000 for insurance.
D) willing to pay $5,000 for insurance.

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