Consider again the bank’s customer loan decision problem in Problem 51. Suppose now that the bank’s utility function of profit x (in dollars) is  Find the strategy that maximizes the bank’s expected...


Consider again the bank’s customer loan decision problem in Problem 51. Suppose now that the bank’s utility function of profit x (in dollars) is
 Find the strategy that maximizes the bank’s expected utility in this case. How does this optimal strategy compare to the optimal decision with an EMV criterion? Explain any difference between the two optimal strategies.



Dec 17, 2021
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