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PaulKet PaulKet
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Posts: 488
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6 years ago
For the utility function U = Wa, what values of "a" correspond to being risk averse, risk neutral, and risk loving?
Textbook 
Microeconomics: Theory and Applications with Calculus

Microeconomics: Theory and Applications with Calculus


Edition: 4th
Author:
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The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.

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wrote...
6 years ago
0 < a < 1 implies risk averse.
a = 1 implies risk neutral.
a > 1 implies risk loving.
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