(Our thanks to Nils Hakansson, University of California, Berkeley, for providing this problem.) Two widows, each with...
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Before making up their minds, they have called on you for advice.
(a) The first widow leaves you unsure as to whether she is risk averse. What advice can you give her?
(b) The second widow shows definite risk aversion. What is your advice to her?
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Financial Theory and Corporate Policy
ISBN: 978-0321127211
4th edition
Authors: Thomas E. Copeland, J. Fred Weston, Kuldeep Shastri
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