Consider Two Identical Fishermen with Utility Functions U(x)= X/2, Where

question 21

Multiple Choice

Consider two identical fishermen with utility functions U(x) = x/2, where x is the number of fish caught. Assume that the probability of either fisherman catching a fish is .05 and that it is impossible for either of them to catch more than one fish. If the two fishermen decided to divide whatever catch was taken, the expected utility of each fisherman would be:

• A)0.1.
• B)less than 0.025.
• C)greater than 0.025 and less than 0.1.
• D)more than 0.1.

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