Tim is offered two gambles.With gamble A, he either gains $2 or loses $1 with a 50% probability.With gamble B, he either gains $3 or loses $2 with a 50% probability.Tim prefers gamble B to gamble A.What can we conclude?

Question

Quizplus · Accepted Answer

Tim prefers gamble B, which has a higher variance and potential loss, indicating he may be risk loving, as he favors a gamble with higher potential reward despite the higher risk.

Tim Is Offered Two Gambles