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Business, 13.02.2020 21:01 fbr45508

Suppose that Natasha's utility function is given by u(l) = I^0.5, where I represents annual income in thousands of dollars. Is Natasha risk loving, risk neutral, or risk averse? Explain. a. She is risk averse because her utility function exhibits diminishing marginal utility. b. She is risk neutral because her utility function exhibits constant marginal utility. c. She is risk loving because her utility function exhibits increasing marginal utility.

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