Question: Hugo has a concave utility function of U(W) = W^0.5. His only asset is shares in an Internet start-up company. Tomorrow he will learn the

Hugo has a concave utility function of U(W) = W^0.5. His only asset is shares in an Internet start-up company. Tomorrow he will learn the stock's value. He believes that it is worth $144 with probability 2/3 and $225 with probability 1/3. illustrate the scenario Hugo faces graphically, thoroughly labeling anything notable, including the risk premium. [Note: Its probably better to not draw this exactly to scale.]

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