Question: iYou have a log utility, , where W is your wealth. Currently, you own $ 1 , 0 0 0 . You are given the

iYou have a log utility,

,

where W is your wealth. Currently, you own $

1, 000 .

You are given the chance to receive a payment of $

805

with a probability of

46 % .

Given the Expected Utility Theory, how much certainty payment would make you indifferent between taking a chance and taking the certainty payment? Enter a number with two decimal points. Answer the question in dollar amount, i

.

.,

if the answer is $

20,

enter

20.00 . (

Note: whenever the calculation involves log and exponential operations, it is wise to keep more decimals in your intermediary steps so that your final two

-

decimal answer is accurate.

)

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