Question: 44. Utility function for money of some decision-maker is as follows: A preference test given to him shows that he is indifferent between an investment
44. Utility function for money of some decision-maker is as follows:

A preference test given to him shows that he is indifferent between an investment that will Yield Rs 10,000 certainly and a risky venture with a 50% chance of Rs 30,000 profit and a 50% chance ofa loss ofRs 1,000.
A new risky venture is proposed with possible paY-offs of either Rs 0 or Rs 20,000. The probabilities of gain cannot be determined. Find the probability combination of Rs 0 and Rs 20,000 which will Yield Rs 10,000 with certainty.
Money (Rs) Utility (-) 1,000 0 5,000 20,000 30,000 (-) 2 0 10 20 30
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