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2. (24 Points) Consider the following gamble: throw a coin, get $15 if the head is up and lose $4 if the tail is up.
2. (24 Points) Consider the following gamble: throw a coin, get $15 if the head is up and lose $4 if the tail is up. {a} (6 points) What is the expected gain of this gamble? Is it a fair gamble? {b} (ti points} Judy has $20 in the pocket. Her utility function is given by tit-m) = \":2. Does she prefer entering the gamble or getting its expected gain for sure, in other words, is Judy riskaverse, riskneutral or riskinclined? What is the least amount of money you need to pay Judy to let her opt out of the gamble? (c) (ti points) Sam has $20 in the pocket. His utility function is given by afar} = '11:. Does he prefer entering the gamble or getting its expected gain for sure, in other words, is Sam riskaverse, riskneutral or riskinclined? {d} (ti points] Sheila has $20 in the pocket. Her utility function is given by tit-w) = . Does she prefer entering the gamble or getting its expected gain for sure, in other words, is Sheila risk-averse, riskneutral or risk-inclined?I
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