Use the following to answer question:
Figure: Risk Aversion
-(Figure: Risk Aversion)Use Figure: Risk Aversion.Bob and Nancy have the same income and the same total utility.Nancy is _____ risk-averse than is Bob because her marginal utility curve is _____ than Bob's.
A)more;flatter
B)more;steeper
C)less;flatter
D)less;steeper

Question

Use the following to answer question:
Figure: Risk Aversion 
-(Figure: Risk Aversion)Use Figure: Risk Aversion.Bob and Nancy have the same income and the same total utility.Nancy is _____ risk-averse than is Bob because her marginal utility curve is _____ than Bob's.
A)more;flatter 
B)more;steeper 
C)less;flatter 
D)less;steeper

Quizplus · Accepted Answer

Nancy is more risk-averse than Bob because a steeper marginal utility curve indicates that she experiences a larger change in utility for a given change in income, reflecting higher sensitivity to risk.

Use the Following to Answer Question