Kreps 18.1e

# Kreps 18.1e - Utility of policies Utility if Utility if...

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Problem 18.1F from Kreps Utility of policies Utility if Utility if Probability of getting job job no job 0.5 0.6 0.7 0.8 0.9 Policy A 254.95 254.95 254.95 254.95 254.95 254.95 254.95 Policy B 254.87 262.72 270.57 278.41 286.26 294.11 215.64 Policy C 251.44 260.99 270.53 280.08 289.62 299.17 203.72 Policy D 250.21 260.16 270.11 280.06 290.01 299.97 200.45 No Ins 250.00 260.00 270.00 280.00 290.00 300.00 200.00 Best ChoicePolicy A Policy B Policy B Policy C Policy D Revenue 2500000 350000 350000 50000 2000 Costs= 2500000 400000 300000 40000 2000 Profits are 0 on A, B, and D Profits are 10,000 on C

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Unformatted text preview: Utility of policies Utility if Utility if Probability of getting job job no job 0.5 0.6 0.7 0.8 0.9 Policy A Policy B Policy C Policy D No Ins Income if Income if Premium Benefit job no job 50000-PremiumBenefit-Premium 25000 25000 25000 50000 46500 6500 3500 10000 49500 1500 500 2000 49980 180 20 200 50000 Income if Income if Premium Benefit job no job 50000-PremiumBenefit-Premium 25000 50000 3500 10000 500 2000 20 200...
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