Emma is considering taking a health insurance. The probability
that she becomes sick is 0.5. If she keeps being healthy, she will
earn $10,000, but if she becomes sick, she will end up with earning
only $1,600. With all the information given, answer the following
questions:
a. Assume that Emma is risk averse, and her utility has a form
of √? where X is her income. The health insurance company would
like to offer an unfair insurance to her. Then,...