-Gunnar Can Work as a Campus Security Officer at a Guaranteed

question 142

Multiple Choice

-Gunnar can work as a campus security officer at a guaranteed salary of $20,000 per year or as a real estate agent. If Gunnar works as a real estate agent, there is a 50 percent chance that he will earn $10,000 per year and a 50 percent chance that he will earn $30,000 per year. Based on the above table, to maximize his expected utility, Gunnar will

• A) choose to work as a campus security officer.
• B) choose to work as a real estate agent.
• C) be indifferent between being a campus security officer and being a real estate agent.
• D) It is impossible to tell which job he would prefer without additional information.