In Problem 8-26, you helped a group of medical professionals analyze a decision, using EMV as the

Question:

In Problem 8-26, you helped a group of medical professionals analyze a decision, using EMV as the decision criterion. This group has also assessed its utility for money: U(-$45,000) = 0,U(-$40,000) = 0.1, U(-$5,000) = 0.7, 17($0) = 0.9, U($95,000) = 0.99, and l/($ 100,000) = 1.
(a) Are the medical professionals risk seekers or risk avoiders? Justify your answer.
(b) Use expected utility as the decision criterion and determine the best decision for the medical professionals (including the option to use the market research firm).