(a)

(b)

(c)

-Refer to Exhibit 6-3. Which utility function is risk preferring?

Name: (a) (b) (c) -Refer to Exhibit 6-3. Which utility function is risk preferring?
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Question

(a)
  
(b)
  
(c)
 
-Refer to Exhibit 6-3. Which utility function is risk preferring?

Quizplus · Accepted Answer

A risk-preferring (or risk-seeking) utility function is characterized by a convex shape, meaning it curves upwards as wealth increases. This indicates that the individual gets more utility for each additional unit of wealth, even more so as wealth grows, showing a preference for risk. Option (C) exhibits this behavior.

(A) (B)(C)-Refer to Exhibit 6-3. Which Utility Function Is Risk Preferring