Question: Can you please help me by estimating my expected wealth in case of a hurricane next year? This is what I found out by reviewing
Can you please help me by estimating my expected wealth in case of a hurricane next year? This is what I found out by reviewing past meteorological data: the probability of a hurricane happening in Texas is 0.52. If the hurricane takes place, I would end up with $25,000 in the bank. But if the hurricane does not happen, then my wealth will be unaffected at $52,300. According to my financial advisor, my utility of having $25,000 is equal to 90, but it is 250 when my wealth is $52,300
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