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When facing a 50% chance of receiving $50 and a 50% chance of receiving $100, the individual pictured in the Figure a) would want to
When facing a 50% chance of receiving $50 and a 50% chance of receiving $100, the individual pictured in the Figure
a)
would want to be paid a risk premium of 10 utils to give up the opportunity of facing the two outcomes.
b)
would want to be paid a risk premium of $7.50 to avoid facing the two outcomes.
c)
would pay a risk premium of $7.50 to avoid facing the two outcomes.
d)
would pay a risk premium of 10 utils to avoid facing the two outcomes.
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