In Problem 9, Billy Has a Von Neumann-Morgenstern Utility Function

question 10

Multiple Choice

In Problem 9, Billy has a von Neumann-Morgenstern utility function U(c) . If Billy is not injured this season, he will receive an income of 4 million dollars. If he is injured, his income will be only 10,000 dollars. The probability that he will be injured is .1 and the probability that he will not be injured is .9. His expected utility is

• A) 3,620 dollars.
• B) 1,810 dollars.
• C) between 3 and 4 million dollars.
• D) 100,000 dollars.
• E) 7,240 dollars.

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Definitions:

Psychosocial Stage

A concept in Erik Erikson's theory referring to the eight stages of human development, each characterized by a different conflict that must be resolved.

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A foundational belief in the reliability and predictability of the world and people around one, typically developed in early childhood.

Different Caregiver

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Disorganized Attachment

A type of insecure attachment where there is a lack of a clear attachment behavior, often seen in children who have experienced inconsistent or traumatic caregiving.