Suppose Paul's utility function over money m is given by uM (m) = ln(500 + m) He is considering whether to get involved in an asset at no initial cost - the lottery L1 below: L1 = { Lose $50 with probability 50% W in $50 with probability 50% (a) What is the expected monetary value of L1? (b) Determine whether or not paul will take L1 (compare with the case of not taking it). (c) What is paul's MU M ? (d) What can you conclude about Paul's attitude toward risk? (e) Paul is now given the choice of whether to take another lottery L2: L2 = { Lose $10 with probability 10% W in $90 with probability 90% What is the expected value of L2? (f) Determine whether or not paul will take L2