Suppose Brandon's benefit function for water is S(W)= W².Brandon is: A) risk averse. B) risk neutral. C) risk loving. D) There is not enough information to answer this question.

Question

Quizplus · Accepted Answer

The presence of P0 (an intercept) in the benefit function suggests that Brandon has a minimum level of satisfaction he requires, indicating risk-loving behavior. Therefore, Brandon would choose the option that gives him the highest possible benefit, even if it comes with higher risk.

Suppose Brandon's Benefit Function for Water Is S(W)= W2

Suppose Brandon's Benefit Function for Water Is S(W)= W²