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Risk Management

Find the utility and the ratio of utility.

1. If the payoff from outcome A is twice the payoff from outcome B, then the ratio of these utilities will be

a.. 2 to 1.

[url removed, login to view] than 2 to 1.

[url removed, login to view] than 2 to 1.

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2. A decision maker has chosen .4 as the probability for which he cannot choose between a certain loss of 10,000 and the lottery p(-25000) + (1-p)(5000). If the utility of -25,000 is 0 and of 5000 is 1, then the utility of -10,000 is

a..5

b..6

c..4

d.4

Skills: Business Analysis, Finance

See more: decision maker chosen, payoff outcome ratio utilities, find maker, finance risk, business p, decision maker, finance management, risk management forex calculator, risk management graphic, graphic design risk management, irm citigroup risk management, writing risk management software

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