Question: Let u = lnw. (a) Does this utility function exhibit the DARA property? (b) Compute u /u andcompare it with u/u. (e) Prove that u(w)isaconcavetransformation

Let u = lnw.

(a) Does this utility function exhibit the DARA property?

(b) Compute −u /u andcompare it with −u/u.

(e) Prove that −u(w)isaconcavetransformation of u(w) (hint: use Pratt’s theorem).

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