Question
By looking at the 2 gambles --> G1(30,18 : 0.6) and G2(32, 16 : 0.6) I calculated their expected utilities --> G1 => (30*0.6) +
By looking at the 2 gambles --> G1(30,18 : 0.6) and G2(32, 16 : 0.6)
I calculated their expected utilities -->
G1 => (30*0.6) + (18*0.4) = 25.2
G2 => (32*0.6) + (16*0.4) = 25.6
Which one first or second order stochastically dominates each other?
(I just gave the numbers at random in order to see the computations. I want to see the logic behind it. It would help if you provide CDF graphs so I can see the dominances clearly.)
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Using Financial Accounting Information The Alternative to Debits and Credits
Authors: Gary A. Porter, Curtis L. Norton
8th edition
1111534918, 978-1111534912
