A Risk-Averse Individual Is Offered a Gamble That Promises a Gain

question 2

Multiple Choice

A risk-averse individual is offered a gamble that promises a gain of $1000 with probability 0.25 and a loss of $300 with probability 0.75.Given this situation,he or she will:

• A)definitely take the gamble.
• B)definitely not take the gamble.
• C)definitely take the gamble if his or her income is high enough.
• D)take an action that cannot be determined given the information available.

---

Definitions:

Amygdala

A part of the brain involved in processing emotions, particularly those related to fear, anxiety, and aggression.

Pubic Hair

Body hair that appears on and around the genital regions during puberty as a secondary sexual characteristic.

Memory Function

The cognitive processes involved in the encoding, storage, and retrieval of information.

Menarche

The beginning of menstruation.