The Slope of the Utility Curves for a Strongly Risk-Averse

question 29

Multiple Choice

The slope of the utility curves for a strongly risk-averse investor,relative to the slope of the utility curves for a less risk-averse investor,will

• A) Be steeper.
• B) Be flatter.
• C) Be vertical.
• D) Be horizontal.
• E) None of the above.

---

Definitions:

Closing Entry

A journal entry made at the end of an accounting period to transfer temporary account balances to permanent accounts.

Revenue Accounts

Revenue accounts are those used in accounting to track the income generated by a business from its normal operations.

Income Summary

An account used in closing entries to summarize revenues and expenses for a specific accounting period before transferring the net income to retained earnings.

Reversing Entries

Accounting entries made at the beginning of a new period to negate the effects of adjustments made at the end of the previous period.