Consider the following von Neumann-Morgenstern utility-of-money function: U($x) = 10 x + In(x) for x 1....

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Consider the following von Neumann-Morgenstern utility-of-money function: U($x) = 10 x + In(x) for x ≥1. (a) What kind of attitude to risk does this utility function display? Show the work that justifies your answer. (b) What is the Arrow-Pratt index of absolute risk-aversion when .x = 2? (c) What is the Arrow-Pratt index of absolute risk-aversion when x = 4? (d) Write an equation whose solution gives the certainty equivalent of lottery $2 $8 $16 31 1 L = . [No need to solve the equation.] (e) Write an equation whose solution gives the risk premium of lottery L = [No need to solve the equation.] $2 $8 $16 Consider the following von Neumann-Morgenstern utility-of-money function: U($x) = 10 x + In(x) for x ≥1. (a) What kind of attitude to risk does this utility function display? Show the work that justifies your answer. (b) What is the Arrow-Pratt index of absolute risk-aversion when .x = 2? (c) What is the Arrow-Pratt index of absolute risk-aversion when x = 4? (d) Write an equation whose solution gives the certainty equivalent of lottery $2 $8 $16 31 1 L = . [No need to solve the equation.] (e) Write an equation whose solution gives the risk premium of lottery L = [No need to solve the equation.] $2 $8 $16