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Oliver takes $2500 with him to a camp and there is 50% chance he will lose $900 on his way. Suppose Oliver can buy an
Oliver takes $2500 with him to a camp and there is 50% chance he will lose $900 on his way. Suppose Oliver can buy an insurance policy that will totally cover his loss, what maximal amount will he be willing to pay for such insurance? Oliver's utility function is given by the function U(E) = E0.5 where E is the amount that he spends on the camp without any saving
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