Given uncertainty, individuals attempt to maximize their:
A)household income.
B)expected utility.
C)risk aversion.
D)consumption.

Question

Quizplus · Accepted Answer

In situations of uncertainty, individuals aim to maximize their expected utility. This means taking into account both the amount of potential gain/loss and the probability of each outcome. By maximizing expected utility, individuals are able to make decisions that balance risk and potential reward, ultimately leading to the best outcome. The other choices (A, C, D) may be factors to consider in decision-making, but maximizing expected utility is the primary goal in uncertain situations.

Given Uncertainty, Individuals Attempt to Maximize Their