contestada

If alan is risk-averse, then he will always

a. choose not to play a game where he has a 75 percent chance of winning $5 and a 25 percent chance of losing $5.

b. choose not to play a game where he has a 50 percent chance of winning $5 and a 50 percent chance of losing $5.

c. choose to play a game where he has a 55 percent chance of winning $5 and a 45 percent chance of losing $5.

d. all of the above are correct.

Respuesta :

ibrahimqureshi
I think the most appropriate answer would be D. Because it has a 50 percent chance of winning $X and a 50 percent chance of losing $Y.



I hope it helped you!
chilljain33

In a condition where Alan is a risk-averse, then he will always choose not to play a game where he has a chance of losing $5. Therefore, the option D holds true.

What is the significance of risk-averse?

A person or any such individual who avoid taking any risk of losing money or goods with monetary value, the such person is known as someone who is a risk-averse. Moreover, a risk averse has a financial behavior that is completely contrasting to that of a risk-taker.

In the condition given above, Alan is a risk-averse. Thus, he will have such a financial behavior where he will avoid playing such games where he has a chance of losing $5 if he loses the game. He will not play a game unless he has surety of winning any monies.

Therefore, the option D holds true regarding the significance of Alan being a risk-averse.

Learn more about a risk-averse here:

https://brainly.com/question/14067217

#SPJ2

Otras preguntas