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In: Statistics and Probability

Suppose you have to pay $2 for a ticket to enter a competition. The prize is...

Suppose you have to pay $2 for a ticket to enter a competition. The prize is $18 and the probability that you win is 1/3. Your current wealth is $10.

(a) Are you going to enter this competition? Justify your decision, that is, choose a utility function that best describes your attitude toward, compute your expected utilities from entering the competition or staying away from it, and compare them to justify your decision.

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orchestra answered 1 year ago
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