A risk-neutral consumer
A)will always refuse a fair gamble.
B)will always accept a fair gamble.
C)is indifferent between accepting and refusing a fair gamble.
D)avoids all risks.

Question

Quizplus · Accepted Answer

A risk-neutral consumer is indifferent between accepting and refusing a fair gamble. This means that the consumer is not risk-averse or risk-seeking and is willing to take a fair gamble if the expected payoff is equal to the cost. However, they will not accept an unfair gamble where the expected payoff is negative.

A Risk-Neutral Consumer