Question: Starting with the finished version of Example 7 . 2 , change the decision criterion to maximize expected utilityusing an exponential utility function with a
Starting with the finished version of Example change the decision criterion to maximize expected utilityusing an exponential utility function with a risk tolerance of $ million. Display certainty equivalents on the tree. aKeep doubling the risk tolerance until the company's best strategy is the same as with the EMV criterioncontinue with development and then market if successful The tolerance must reach $ before the riskaverse company acts the same as the EMVmaximizing company even though the EMV from the original strategy with b With a risk tolerance of $ the company views the optimal strategy as equivalent to receiving a sure risk tolerance is Round your final answer to the nearest $ if necessary
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