Which of the following correctly describes prospect theory?

Selected Answer:	Prospect theory implies that utility function is convex
Answers:	Prospect theory suggests that people tend to be risk averse when facing uncertain gains, but risk-seeking when facing uncertain losses
	Prospect theory implies that utility function is convex
	Prospect theory suggests that people take into account their initial total wealth when making decisions under uncertainty
	Prospect theory describes how people should properly make decisions under uncertainty