Which of the Following Is Correct Concerning a Risk-Averse Person

question 21

Multiple Choice

Which of the following is correct concerning a risk-averse person?

• A)She would not play games where the probability of winning and losing a dollar are the same.
• B)She might not buy health insurance if she thinks her risks are low.
• C)Her marginal utility of wealth decreases as her income increases.
• D)All of the above are correct.

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Definitions:

Accommodation Party

A party who signs an instrument to provide credit for another party who has also signed the instrument.

Recover Money

The act or process of legally reclaiming monetary losses or damages through judicial or administrative procedures.

Accommodated Party

In finance, the party for whom a loan or credit extension is made, usually facilitated by the guarantee or cosigning by another party.

Ratification

The formal approval or confirmation of an act or agreement that was signed but not yet authorized.