What does this imply about bobs attitudes towards risk

Reference no: EM133707365

Question: You do not need to fill in the tables below by hand if you do it in the spreadsheet. 1. Suppose Bob has income of $18,000. There is a 20% chance that Bob will get sick and have to spend $10,000 of his income on a treatment. Suppose Bob's income-utility relationship is given by: Where I is Bob's income. () = √ a. Use the facts above to complete the table below to find Bob's utility for various levels of income, along with his marginal utility associated with increases in his income. Use the given values to help you get started. What do you notice about the shape of this curve? What does this imply about Bob's attitudes towards risk?

Reference no: EM133707365

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