Use the Following to Answer Question

question 192

Multiple Choice

Use the following to answer question:
-(Table: Income and Utility for Tyler) Use Table: Income and Utility for Tyler.The table shows the utility Tyler receives at various income levels,but she does not know what her income will be next year.There is a 40% chance her income will be $20,000,a 40% chance her income will be $30,000,and a 20% chance her income will be $40,000.We know that Tyler is risk-averse because:

• A)she would prefer $40,000,but there is a risk she will make only $20,000.
• B)her expected income is less than what she may actually earn.
• C)her expected income is more than what she may actually earn.
• D)she is subject to diminishing marginal utility from income.

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Definitions:

Preventative

Measures or actions taken to prevent the occurrence of undesirable events, diseases, or conditions.

Corrective

Intended to rectify or improve a situation, often by fixing an error or resolving a problem.

Disease Prevention

The methods and strategies employed to prevent the onset of diseases, aiming to reduce the risk of diseases spreading or occurring.