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(Solved): Give arguments in favour or against the following statements. Answer of each part should not exceed ...



Give arguments in favour or against the following statements. Answer of each part should not exceed 15 lines. Mathematical proofs are not required. (marks 20) The axiom of strong independence of lotteries implies that utility function of consumer with contingent commodities are additively separable. For a risk averse individual, the expected utility of lottery is less than utility of the expected value of lottery



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