Billy Has a Von Neumann-Morgenstern Utility Function U(c)= C^1/2

question 24

Multiple Choice

Billy has a von Neumann-Morgenstern utility function U(c) = c^1/2.If Billy is not injured this season, he will receive an income of 25 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)4,510 dollars.
• B)between 24 and 25 million dollars.
• C)100,000 dollars.
• D)9,020 dollars.
• E)18,040 dollars.

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Definitions:

Emotional Factors

Elements that influence feelings, mood, and emotional state, impacting behavior, decision-making, and mental health.

Pregnancy Status

The condition of being pregnant or not, including various stages and health considerations of pregnancy.

Cane

A supporting device used to assist walking, providing stability and balance.

Hip Bone

A large bone forming the main part of the pelvis on each side of the body, pivotal in supporting the upper body and facilitating leg movement.