Utility rises at a decreasing rate for a ____ person.
A)risk-seeking
B)risk-averse
C)risk-neutral
D)risk-indifferent

Question

Quizplus · Accepted Answer

A risk-averse person is someone who prefers lower risk and higher certainty. As they seek security, their utility rises at a decreasing rate. This is because they derive a decreasing level of satisfaction from each additional unit of income or gain due to their preference for safety.

Utility Rises at a Decreasing Rate for a ____ Person