A manager expresses indifference between a certain profit of $5,000 and a venture with a 70% chance of making $10,000 and a 30% chance of making nothing. If the manager's utility-scale is set at 1 utile for $0. and 100 utiles for $10,000. If the manager is indifferent between a venture that has a 60% chance of making $10,000 and a 40% chance of making $1,000, and a sure investment that yields $5,000. Find the value of $1,000 in utiles for this manager.

Answer rating: 100% (QA)

We can solve this problem by setting up equations based on the information provided and using the ex... View the full answer