Yoram's Expected Utility Function Is Pc ₁

Multiple Choice

Yoram's expected utility function is pc ₁ + (1 - p) c
₂, where p is the probability that he consumes c₁ and 1 - p is the probability that he consumes c₂. Wilbur is offered a choice between getting a sure payment of $Z or a lottery in which he receives $2,500 with probability .30 and $3,600 with probability .70. Wilbur will choose the sure payment if

A) Z > 3,249 and the lottery if Z < 3,249.
B) Z > 2,874.50 and the lottery if Z < 2,874.50.
C) Z > 3,600 and the lottery if Z < 3,600.
D) Z > 3,424.50 and the lottery if Z < 3,424.50.
E) Z > 3,270 and the lottery if Z < 3,270.