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Consider a person with the following value function under prospect theory: v ( w ) = w .0.4 if w 0 =-2(- w .)0.4 if

Consider a person with the following value function under prospect theory:

v(w) = w.0.4 if w 0

=-2(-w.)0.4 if w < 0

Assume that this individual weight values by probabilities, instead of using the prospect theory weighting function. What is the value of the following prospect?

P1 (0.2, 1000, -800)

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