(Table: Income and Utility for Tyler) the Table Income and Utility

question 132

Multiple Choice

(Table: Income and Utility for Tyler) The table Income and Utility for Tyler 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.What level of certain income gives her the same utility as her expected utility, given the uncertainty?

• A)$28,000
• B)$25,000
• C)$26,516
• D)$29,000

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Definitions:

Value

Value in finance refers to the monetary, material, or assessed worth of an asset, investment, or company.

Governments

are the organized systems of authority that regulate communities or societies and provide structure for political, economic, and social interactions.

Exchange Rates

The rate at which one currency can be exchanged for another, influencing international trade and investment.

Foreign Investment

Investment in domestic companies and assets of another country by individuals, companies, or governments.