Sally Kink Is an Expected Utility Maximizer with Utility Function

question 7

Multiple Choice

Sally Kink is an expected utility maximizer with utility function pu(c₁) + (1 - p) u(c₂) , where for any x < 7,000, u(x) = 2x, and for x greater than or equal to 7,000, u(x) = 14,000 + x.

• A) Sally will be risk averse if her income is less than $7,000 but risk loving if her income is more than $7,000.
• B) Sally will be risk neutral if her income is less than $7,000 and risk averse if her income is more than $7,000.
• C) Sally will never take a bet if there is a chance that it leaves her with wealth less than $14,000.
• D) For bets that involve no chance of her wealth exceeding $7,000, Sally will take any bet that has a positive expected net payoff.
• E) None of the above.

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Definitions:

Psychomotor Skills

Skills related to the coordination and movement of muscles with the integration of mental processing, such as manual dexterity and physical manipulation tasks.

Task Sequencing

The order in which tasks are to be performed or arranged, often planned to improve efficiency, learning, or performance.

Robert Gagné's

Robert Gagné's theory emphasizes the conditions of learning and identifies several steps involved in the process, such as gaining attention, providing stimulus, and eliciting performance.

Learning Guidance

Provision of direction and advice to learners to help them navigate and process information more effectively.