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economics in healthcare 1. Suppose my utility Jnction is U(I) = I 1/2 , where I = income. I face a risk p = 0.3

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economics in healthcare

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1. Suppose my utility Jnction is U(I) = I 1/2 , where I = income. I face a risk p = 0.3 of getting sick. My initial income is $160,000 but whenI get sick it decreases to $90,000. (a) What is my marginal utility of income? Am I risk-averse? How do you know? (b) Calculate actuarially fair premium? (0) Calculate my maximum willing ness to pay for health insurance

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