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For the St Petersburg Parabox, do the following (i) Calculate the expected monetary value of the game. (ii) Assume that the utility function is u(x)
For the St Petersburg Parabox, do the following
(i) Calculate the expected monetary value of the game.
(ii) Assume that the utility function is u(x) = ln(x). Calculate the expected utility value
of the game and the number of the tosses needed to reach this value. And what is the corresponding cash equivalence of the game? [Hint: Present the calculation for the accuracy up to 4 decimal points.]
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