Jonathan has a utility function expressed
Microeconomics
Jonathan has a utility function expressed as u=w0.3 where w is his wealth. Jonathan currently has $100. If Jonathan is confronted with a gamble that has a 10% chance of paying out $20 and a 90% chance of paying $0, what would be his expected utility if he takes this gamble?
A) 0.42 utiles
B) 1.23 utiles
C) 4.002 utiles
D) 4.004 utiles
E) 4.4 utiles
