Hernandezx1692 Hernandezx1692

06-06-2023
Business

contestada

Consider the risky prospect Y=(4,16,25;1/4,1/2,1/4). The vN−M utility function of Ulises is u(x)= x

. Given that EY= 15.25 and σ 2
=55.6875. Calculate the Risk premium (Not the Arrow-Pratt approximation) of Ulises when he faces the risky prospect Y. (use two decimals)

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