Vicky N Vestor s utility function was given in Problem 2 Vicky N. Vestor’s utility function was…

Vicky N Vestor s utility function was given in Problem 2
Vicky N. Vestor’s utility function was given in Problem 2. As in Problem 2, Vicky currently has income of $4,000. She is considering investing in a startup company, but the investment now costs $4,000 to make. If the company fails, Vicky will get nothing from the company. But if the company succeeds, she will get $10,000 from the company (her original investment of $4,000 plus $6,000 of the company’s profits). Each event has a 0.5 probability of occurring. Will Vicky invest in the company?

Vicky N Vestor s utility function was given in Problem 2

 

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