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285 10$ 50$ Consider the following lotteries: L1 = 1 and Ly = 1. Ann has the following von Neumann-Morgenstern utility function: UANN = vm.

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285 10$ 50$ Consider the following lotteries: L1 = 1 and Ly = 1. Ann has the following von Neumann-Morgenstern utility function: UANN = vm. How does she rank the two lotteries? 2. Bob has the following von Neumann-Morgenstern utility function: UBOB = 2m - m" How does he rank the two lotteries? 3. Verify that both Ann and Bob are risk averse, by determining what they would choose between lottery L2 and its expected value for certain

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