b. Compare Carolyns willingness-to-pay to Sanjays. Why do they differ? Include a comparison Outcome A Outcome B

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b. Compare Carolyn’s willingness-to-pay to Sanjay’s.

Why do they differ? Include a comparison Outcome A Outcome B Probability Earnings Probability Earnings Job 1 0.5 20 0.5 40 Job 2 0.3 15 0.7 45 Job 3 1 30 Exercises 617 of their Arrow-Pratt measures of risk aversion.

(Hint: See Solved Problem 16.4.) m 3. Reducing Risk

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Microeconomics With Calculus

ISBN: 9780273789987

3rd Global Edition

Authors: Jeffrey M. Perloff

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