Give argument in favor or against of following statements.

$5.$The expected utility hypothesis states that utility of a lottery is the expectation of the utility from its prizes. Utility is additively separable over the outcomes and linear in the probabilities.

$6.$Arrow$-$Pratt measure of absolute risk aversion depend upon the unit of income, and it measures the degree of risk aversion at the specific level of income only

$7.$For a Risk Averse individual, an indifference curve is bowed inside towards origin $($convex$)$ and the slope of each Indifference curve as it intersects the certainty line is minus the odds in favor of contingent commodity on the horizontal axis.

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In favor The expected utility hypothesis provides a coherent framework for decisionmaking under unce... View the full answer