Which of the following assumptions concerning individual behaviour in risky situations guarantees that individuals will be willing to make trade offs between risky and riskless prospects?
A)the continuity assumption
B)the substitution assumption
C)the ordering assumption
D)the transitivity assumption

Question

Quizplus · Accepted Answer

The continuity assumption ensures that individuals are willing to make trade-offs between risky and riskless prospects by allowing for a comparison and combination of different levels of risk and certainty, facilitating decision-making in uncertain environments.

Which of the Following Assumptions Concerning Individual Behaviour in Risky