For an Individual Whose Coefficient of Relative Risk Aversion Is

Multiple Choice

For an individual whose coefficient of relative risk aversion is 1 (and who displays constant relative risk aversion as income changes) ,utility is equal to the natural logarithm of income. That is, where X denotes income. For such an individual,what income level is the certainty equivalent of a risky income with a 50% chance of being $90,000 and a 50% chance of being $40,000?

A) $50,000
B) $60,000
C) $65,000
D) $70,000
E) $80,000