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Suppose that we observe the following preference (where X > 0 or X ( $0 , 0.9 ; $X , 0.1 ) (a) Suppose that

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Suppose that we observe the following preference (where X > 0 or X ( $0 , 0.9 ; $X , 0.1 ) (a) Suppose that Skye is a risk-averse expected utility maximizer. For what values of X could Skye exhibit this preference? (b) Suppose that Jane evaluates gambles according to prospect theory with 7(p) = p and a value function that has the three properties suggested by Kahneman & Tversky. For what values of X could Jane exhibit this preference? (c) Suppose that Elizabeth evaluates gambles according to prospect theory with a value function that has the three properties suggested by Kahneman & Tversky, and with a probability weighting function that has 7(0.1) > 0.1. For what values of X could Elizabeth exhibit this preference? Suppose instead that we observe the following preference (where Y > 0 or Y ( $0.4Y , 1 ) (d) Suppose that Skye is a risk-averse expected utility maximizer. For what values of Y could Skye exhibit this preference? (e) Suppose that Jane evaluates gambles according to prospect theory with (p) = p and a value function that has the three properties suggested by Kahneman & Tversky. For what values of Y could Jane exhibit this preference? (f) Suppose that Elizabeth evaluates gambles according to prospect theory with a value function that has the three properties suggested by Kahneman & Tversky, and with a probability weighting function that has 7(0.4)

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