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5. There are 3 poker players, A, B, and C. They each have reference-dependent pref- erences over money m, with a reference point of r.

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5. There are 3 poker players, A, B, and C. They each have reference-dependent pref- erences over money m, with a reference point of r. Letting :r: : m 1', their utility functions are as follows: [a] [2.5 points] graph 114.1(3) and 113(3). [h] [2.5 points] For player A and player B 1 state whether their preferences satisfy loss aversion or diminishing sensitivity. [c] [5 points] For what values of CE 2} U and d 3: U would player C's preferences satisfy loss aversion and diminishing sensitivity? Which parameter value captures which property

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