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Suppose you have to pay $2 for a ticket to enter a competition. The prize is...

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Statistics

Suppose you have to pay $2 for a ticket to enter a competition.The prize is $18 and the probability that you win is 1/3. Yourcurrent wealth is $10.

(a) Are you going to enter this competition? Justifyyour decision, that is, choose a utility function that bestdescribes your attitude toward, compute your expected utilitiesfrom entering the competition or staying away from it, and comparethem to justify your decision.

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