Suppose that my utilit function is (w) = w2. %3D (a) fI played one round of the St. Petersburg Lottery, would would my expected utility be? Assume i cutrently have zero wealth, and round your answer to two decimals places. Note that in order to compute my expected utility, you will need to sum a geometric series. Expected Utility utiles. (b) Use your rounded answer from (a) to determine my certainty equivalent for the St. Petersburg Lottery. Round your answer to the nearest cent. Certainty Equivalent = $

Suppose that my utilit function is (w) = w2. %3D (a) fI played one round of the St. Petersburg Lottery, would would my expected utility be? Assume i cutrently have zero wealth, and round your answer to two decimals places. Note that in order to compute my expected utility, you will need to sum a geometric series. Expected Utility utiles. (b) Use your rounded answer from (a) to determine my certainty equivalent for the St. Petersburg Lottery. Round your answer to the nearest cent. Certainty Equivalent = $

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Find the attached file.
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