Question 3 Justin is currently working full time and earns $5D,UDI]. If he is promoted, he would earn $S,Dl]. Right now his chance of being promoted is 30%. He considers getting a master degree in Economics to help improving his chance of being promoted. Suppose, there is 5% chance that he would fail to complete the degree. Without this degree, his chance of being promoted remains at 311%. However, if he gets the degree, the chance to be promoted will increase to 8D%. Justin is an expected utility maso'miser and his utility function over the nonnegative wealth, as, is given by: Mm) : V's [a] ('5 marks) Is Justin riskaverse, riskneutral, or riskseeking? Show your work. [b] ('5 marks) Compute Justst expected utility if he chooses not to enrol in the Master program. [c] ('5 marks) Assume that the Master program is fully subsidised, i.e., it is free. Com pute Justin's expected utility if he chooses to emol in the Master program. [d] ('5 marks) Now assume that the program is not free, what is the maximum fee, F, that Justin is willing to pay to enrol in the Master program? [Hint Set up the equality and use any program or software to nd the value F that solves the equation. For example, https: f [www.wolfr amalpha.comf calculators fequationsolvercalculator] [e] ('5 marks) Suppose now that the price of the master program is F = $15,D and, upon being promoted, Justin's new salary would be top. Find the minimum salary any for which Justin enrols in the Master program. [Hint Set up the equation and use any program or software to nd tap that solves the equation. For example, https: f ,H' www.wol'amalpha.com f calculators f equationaolvercalculator]