Pedro's Utility of Wealth Is 6 Units for $10,000 and 10

question 64

Multiple Choice

Pedro's utility of wealth is 6 units for $10,000 and 10 units for $20,000. A friend gave him a lottery ticket for his birthday. The ticket won, giving him either $10,000 with probability 0.5 or $20,000 with probability 0.5. Pedro's expected utility from the lottery ticket is

• A) between 6 and 8 units.
• B) equal to 8 units.
• C) between 8 and 10 units.
• D) equal to 10 units.

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Definitions:

Open Format

a structure that allows for flexibility and adaptation, often in the context of meetings, events, or documents.

Scapegoat

An individual or group blamed for wrongs they didn't commit, often to divert attention from the actual source of a problem.

Expressive Role

A social role focused on emotional support, communication, and maintaining group harmony.

Treatment Group

A group of participants in an experiment or study who receive the intervention or treatment being evaluated.