-Assume the Information in the Table Regarding the Probability and

question 18

Multiple Choice

$\begin{array}{|l|l|l|l|l|}\hline \text { Investment } & \text { A } && \text { B } \\\hline \text { State description } & \text { Bad state } & \text { Good state } & \text { Bad state } & \text { Good state } \\\hline \text { Probability } & 0.25 & 0.75 & 0.25 & 0.75 \\\hline \text { Payoff } & 200 & 220 & 400 & 435 \\\hline\end{array}$
-Assume the information in the table regarding the probability and payoffs of assets A and B relates to an investor who has a log utility function.By how much will the utility of asset B exceed that of asset A for this investor?

• A) \( -0.712 \)
• B) \( -0.687 \)
• C) \( 0.684 \)
• D) \( 0.712 \)

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Definitions:

Source-Monitoring Error

A type of memory error where a person misidentifies the source or origin of a memory, such as confusing a dream for a real memory.

Psychology Professor

An academic or professor who teaches and researches in the field of psychology, studying mental functions and behaviors.

Incorrectly Recall

The phenomena of remembering past events or information inaccurately, which can be due to various cognitive biases or memory distortions.

Source Monitoring

The process of making inferences about the origins of memories, knowledge, and beliefs.