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

Question

Quizplus · Accepted Answer

Gamble B has a higher potential gain and loss compared to gamble A, indicating that Tim prefers the higher risk and reward, suggesting he is risk loving.

Tim Is Offered Two Gambles