Given the Choice Between a Sure-Thing Option and a Gamble

question 12

Multiple Choice

Given the choice between a sure-thing option and a gamble option with the same expected payoff, a____________ person will choose the sure thing.

• A)risk averse
• B)risk loving
• C)risk neutral
• D)risk enjoying
• E)none of the above

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Definitions:

Radius

The length measured from a circle's midpoint to any location along its outer edge.

Center

The middle point of a shape, object, or group of points, often equidistant from all outer edges or surfaces.

Radius

The distance from the center to the circumference of a circle or sphere.

Parabola

A symmetrical, open curve that represents the graph of a quadratic function, defined as the set of all points equidistant from a point called the focus and a fixed line called the directrix.