Suppose a Decision Maker Has a Utility Function $U = \sqrt { I }$

question 62

Multiple Choice

Suppose a decision maker has a utility function $U = \sqrt { I }$ and is faced with a lottery where there is a 30% chance of earning $30 and a 70% chance of earning $80. What is the expected utility of this lottery?

• A) 7.6
• B) 7.9
• C) 8.2
• D) 8.5

---

Definitions:

Larger

Comparatively greater in size, quantity, or extent.

Herbal Remedies

Natural plant-based products used to prevent, alleviate, or cure diseases and conditions, often part of traditional or alternative medicine practices.

Nutritional Supplements

Products taken orally that contain dietary ingredients intended to supplement the diet, such as vitamins, minerals, herbs, or amino acids.