Billy Pigskin from your workbook has a von Neumann-Morgenstern utility function If Billy is not injured this season, he will receive an income of $25 million. If he is injured, his income will be only $10,000. The probability that he will be injured is .1 and the probability that he will not be injured is .9. His expected utility is
A) 100,000.
B) 9,020.
C) between 24 million and 25 million.
D) 4,510.
E) 18,040.

Question

Billy Pigskin from your workbook has a von Neumann-Morgenstern utility function  If Billy is not injured this season, he will receive an income of $25 million. If he is injured, his income will be only $10,000. The probability that he will be injured is .1 and the probability that he will not be injured is .9. His expected utility is
A) 100,000. 
B) 9,020. 
C) between 24 million and 25 million. 
D) 4,510. 
E) 18,040.

Quizplus · Accepted Answer

The Answer of Billy Pigskin from your workbook has a von Neumann-Morgenstern utility function  If Billy is not injured this season, he will receive an income of $25 million. If he is injured, his income will be only $10,000. The probability that he will be injured is .1 and the probability that he will not be injured is .9. His expected utility is
A) 100,000. 
B) 9,020. 
C) between 24 million and 25 million. 
D) 4,510. 
E) 18,040.

Billy Pigskin from Your Workbook Has a Von Neumann-Morgenstern Utility