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Chez Paul Is Contemplating Either Opening Another Restaurant or Expanding

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Chez Paul is contemplating either opening another restaurant or expanding its existing location.The payoff table for these two decisions is:
Chez Paul is contemplating either opening another restaurant or expanding its existing location.The payoff table for these two decisions is: Paul has calculated the indifference probability for the lottery having a payoff of $160,000 with probability p and -$80,000 with probability (1-p)as follows: a.Is Paul a risk avoider,a risk taker,or risk neutral? b.Suppose Paul has defined the utility of -$80,000 to be 0 and the utility of $160,000 to be 80.What would be the utility values for -$40,000,$20,000,and $100,000 based on the indifference probabilities? c.Suppose P(s<sub>1</sub>)= .4,P(s<sub>2</sub>)= .3,and P(s<sub>3</sub>)= .3.Which decision should Paul make? Compare with the decision using the expected value approach. Paul has calculated the indifference probability for the lottery having a payoff of $160,000 with probability p and -$80,000 with probability (1-p)as follows:
Chez Paul is contemplating either opening another restaurant or expanding its existing location.The payoff table for these two decisions is: Paul has calculated the indifference probability for the lottery having a payoff of $160,000 with probability p and -$80,000 with probability (1-p)as follows: a.Is Paul a risk avoider,a risk taker,or risk neutral? b.Suppose Paul has defined the utility of -$80,000 to be 0 and the utility of $160,000 to be 80.What would be the utility values for -$40,000,$20,000,and $100,000 based on the indifference probabilities? c.Suppose P(s<sub>1</sub>)= .4,P(s<sub>2</sub>)= .3,and P(s<sub>3</sub>)= .3.Which decision should Paul make? Compare with the decision using the expected value approach.
a.Is Paul a risk avoider,a risk taker,or risk neutral?
b.Suppose Paul has defined the utility of -$80,000 to be 0 and the utility of $160,000 to be 80.What would be the utility values for -$40,000,$20,000,and $100,000 based on the indifference probabilities?
c.Suppose P(s1)= .4,P(s2)= .3,and P(s3)= .3.Which decision should Paul make? Compare with the decision using the expected value approach.

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a.A risk avoider
b.Amount Util...

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