If X Is a Monetary Value (A Payoff If Positive,a $e ^ { x d R }$

question 24

Multiple Choice

If x is a monetary value (a payoff if positive,a cost if negative) ,U(x) the utility of this value,and R > 0 is an adjustable parameter called the risk tolerance,then the function U(x) = 1 - $e ^ { x d R }$
Is called

• A) Poisson utility
• B) exponential utility
• C) binomial utility
• D) normal utility

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Definitions:

Prefix

An affix placed before a word to modify its meaning, such as re-, un-, or anti-.

-poiesis

A suffix meaning the formation, production, or generation of something, such as in 'hemopoiesis' the production of blood cells.

Suffix

A morpheme added at the end of a word to form a derivative, e.g., -tion, -sion, -ness.

Formation

The process of developing or being formed; in biology, it often refers to the way cells or tissues are created and organized.