Question: Given that the utility function is the power utility function () =(1/(1))*^1, where is the constant relative risk aversion coefficient, and that the investor faces

Given that the utility function is the power utility function () =(1/(1))*^1, where is the constant relative risk aversion coefficient, and that the investor faces a gamble in which he wins or loses some amount x with 50:50 probabilities, we can use the expected utility theory to determine the amount of that he would pay to avoid the gamble.

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