Marvin is an expected utility maximizer. He chooses his portfolio so as to maximize the expected value of 2,000,000x - x². If m is the mean of Marvin's income and s is the standard deviation, Marvin's income as a function of the mean and standard deviation is

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From the given information, Marvin chooses his portfolio to maximize the expected value of 2,000,000x - x². Let X be the random variable representing Marvin's income. Then the expected value of X is: E(X) = 2,000,000m - m² Since Marvin is an expected utility maximizer, his utility function should depend on the mean and standard deviation of his income. Let U be Marvin's utility function. Then: U = U(m, s) Therefore, the income function as a function of the mean and standard deviation is: U = 2,000,000m - s² (choice A).

Marvin Is an Expected Utility Maximizer