Solved

Refer to the Data Provided in Table 17 -Refer to Table 17

Question 40

Multiple Choice

Refer to the data provided in Table 17.2 below to answer the following question(s) . The table shows the relationship between income and utility for Sue.
Table 17.2
 Income  Total Utility $00$20,00020$40,00040$60,00060$80,00080\begin{array} { | c | c | } \hline \text { Income } & \text { Total Utility } \\\hline \$ 0 & 0 \\\hline \$ 20,000 & 20 \\\hline \$ 40,000 & 40 \\\hline \$ 60,000 & 60 \\\hline \$ 80,000 & 80 \\\hline\end{array}
-Refer to Table 17.2. Sue earns $40,000 annually. She has the opportunity to bet her entire salary on the upcoming super bowl. If Sue takes the bet, she will pick the Patriots. She believes that the Patriots have a 50-50 chance of winning the game. If the Patriots win, Sue will double her money ($80,000) but if they lose she loses her entire salary ($0) . This bet can be characterized as


A) risk-neutral.
B) an unfair bet.
C) a fair bet.
D) risk-loving.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents