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Which of the Following Utility Functions Exhibits Constant Relative Risk U(W)=W0.5W2U ( W ) = W - 0.5 W ^ { 2 }

Question 6

Multiple Choice

Which of the following utility functions exhibits constant relative risk aversion?


A) U(W) = W.
B) U(W) =W0.5W2U ( W ) = W - 0.5 W ^ { 2 }
C) U(W) = ln W.
D) U(W) = eW- e ^ { - W } .

Correct Answer:

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