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Can u show the steps too and answer: Consider an asset equal to 850 with probability 0.7, and 0 with probability 0.3. An individual with
Can u show the steps too and answer: Consider an asset equal to 850 with probability 0.7, and 0 with probability 0.3. An individual with utility function u(x)=4 (x+400)1/2 has to decide whether to sell the asset. If they sell the asset, they receive the price. If they do not sell, they keep the asset.
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The minimum price they would accept is 595.
The minimum price they would accept is 545.
The minimum price they would accept is 508.
The minimum price they would accept is 945.
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