Consider the same representative agent economy described in Exercise 4.11, but with the expected utility function [uleft(x_{0},
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Consider the same representative agent economy described in Exercise 4.11, but with the expected utility function
\[u\left(x_{0}, x_{1}, x_{2}\right)=x_{0}^{\gamma}+\frac{1}{2} x_{1}^{\gamma}+\frac{1}{2} x_{2}^{\gamma}\]
with \(0)\) of the two Arrow securities as well as the return \(r_{f}\) of the risk free asset with constant payoff 1 .
Data From Exercise 4.11
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Related Book For
Financial Markets Theory Equilibrium Efficiency And Information
ISBN: 9781447174042
2nd Edition
Authors: Emilio Barucci, Claudio Fontana
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