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Q1 (3 points) You have $100, but you might lose $36 with a probability of 20%. Write down the equation of the iso-expected-income line you
Q1 (3 points) You have $100, but you might lose $36 with a probability of 20%. Write down the equation of the iso-expected-income line you are on, and draw it in a diagram measuring your income in the good state of nature. What is its slope? 02 (3 points) Your utility of money is u(y) : . What is the slope of the indifference curve you are on? Sketch your indifference curve in the diagram you used to answer question 1
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