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Suppose a consumer has income I=$100. If the consumer gets sick, he must go to the doctor. The cost of a visit to the doctor.is

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Suppose a consumer has income I=$100. If the consumer gets sick, he must go to the doctor. The cost of a visit to the doctor.is $75. The consumer's utility from income Is U(1) = VI. The probability of getting sick depends on whether the consumer goes to the gym. If the consumer goes to the gym, then he gets sick with probability 10%. If the consumer does not go to the gym, then he gets sick with probability 90%. The cost of going to the gym is $10. Now the insurance company offers a new insurance plan, with a copay. The consumer pays a premium p=7.5 upfront. If the consumer gets sick, then the insurance company fully pays for the doctor. However, when the consumer gets sick, he needs to pay $13 to the insurance company (this is the copay). Compute the consumer's expected utility if he purchases the copay insurance AND goes to the gym: E(u)= Compute the consumer's expected utility if he purchases the copay insurance AND does NOT go to the gym: E(u)= Will the consumer choose to go to the gym? (select yes or no)

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