Matt's Utility Function $$\begin{array} { c c } \text { Wealth } & \text { Utilty } \\\$ 50,000 & 7000 \\51,000 & 7250 \\52,000 & 7499 \\53,000 & 7746\end{array}$$

Matt's Utility Function $$\begin{array} { c c } \text { Wealth } & \text { Utilty } \\\$ 50,000 & 7000 \\51,000 & 7250 \\52,000 & 7499 \\53,000 & 7746\end{array}$$ If Matt's current wealth is $51,000, then

A) his gain in utility from gaining $1,000 is greater than his loss in utility from losing $1,000. Matt is risk averse.
B) his gain in utility from gaining $1,000 is greater than his loss in utility from losing $1,000. Matt is not risk averse.
C) his gain in utility from gaining $1,000 is less than his loss in utility from losing $1,000. Matt is risk averse.
D) his gain in utility from gaining $1,000 is less than his loss in utility from losing $1,000. Matt is not risk averse.

Correct Answer:

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Access For Free