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Increasing risk and risk aversion

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A quick demonstration of the elements of risk from an economics perspective.

A quick demonstration of the elements of risk from an economics perspective.

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  • 1. I
  • 2. In
  • 3. Inc
  • 4. Incr
  • 5. Incre
  • 6. Increa
  • 7. Increas
  • 8. Increasi
  • 9. Increasin
  • 10. Increasing
  • 11. Increasing R
  • 12. Increasing Ri
  • 13. Increasing Ris
  • 14. Increasing Risk
  • 15. Increasing Risk a
  • 16. Increasing Risk an
  • 17. Increasing Risk and
  • 18. Increasing Risk and R
  • 19. Increasing Risk and Ri
  • 20. Increasing Risk and Ris
  • 21. Increasing Risk and Risk
  • 22. Increasing Risk and Risk A
  • 23. Increasing Risk and Risk Av
  • 24. Increasing Risk and Risk Ave
  • 25. Increasing Risk and Risk Aver
  • 26. Increasing Risk and Risk Avers
  • 27. Increasing Risk and Risk Aversi
  • 28. Increasing Risk and Risk Aversio
  • 29. Increasing Risk and Risk Aversion
  • 30. Increasing Risk and Risk Aversionx
  • 31. Increasing Risk and Risk Aversionx =
  • 32. Increasing Risk and Risk Aversionx = (
  • 33. Increasing Risk and Risk Aversionx = (x
  • 34. Increasing Risk and Risk Aversionx = (x1
  • 35. Increasing Risk and Risk Aversionx = (x1,
  • 36. Increasing Risk and Risk Aversionx = (x1,x
  • 37. Increasing Risk and Risk Aversionx = (x1,x2
  • 38. Increasing Risk and Risk Aversionx = (x1,x2)
  • 39. Increasing Risk and Risk Aversionx = (x1,x2) i
  • 40. Increasing Risk and Risk Aversionx = (x1,x2) is
  • 41. Increasing Risk and Risk Aversionx = (x1,x2) is a
  • 42. Increasing Risk and Risk Aversionx = (x1,x2) is a r
  • 43. Increasing Risk and Risk Aversionx = (x1,x2) is a ra
  • 44. Increasing Risk and Risk Aversionx = (x1,x2) is a ran
  • 45. Increasing Risk and Risk Aversionx = (x1,x2) is a rand
  • 46. Increasing Risk and Risk Aversionx = (x1,x2) is a rando
  • 47. Increasing Risk and Risk Aversionx = (x1,x2) is a random
  • 48. Increasing Risk and Risk Aversionx = (x1,x2) is a random v
  • 49. Increasing Risk and Risk Aversionx = (x1,x2) is a random va
  • 50. Increasing Risk and Risk Aversionx = (x1,x2) is a random var
  • 51. Increasing Risk and Risk Aversionx = (x1,x2) is a random vari
  • 52. Increasing Risk and Risk Aversionx = (x1,x2) is a random varia
  • 53. Increasing Risk and Risk Aversionx = (x1,x2) is a random variab
  • 54. Increasing Risk and Risk Aversionx = (x1,x2) is a random variabl
  • 55. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable
  • 56. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.
  • 57. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p
  • 58. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p =
  • 59. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = p
  • 60. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = pr
  • 61. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = pro
  • 62. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob
  • 63. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {
  • 64. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x
  • 65. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x =
  • 66. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x
  • 67. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1
  • 68. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1}
  • 69. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1
  • 70. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 -
  • 71. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p
  • 72. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p
  • 73. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p =
  • 74. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = p
  • 75. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = pr
  • 76. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = pro
  • 77. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob
  • 78. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {
  • 79. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x
  • 80. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x =
  • 81. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x
  • 82. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2
  • 83. Increasing Risk and Risk Aversionx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 84. Increasing Risk and Risk AversionEx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 85. Increasing Risk and Risk AversionE(x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 86. Increasing Risk and Risk AversionE(xx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 87. Increasing Risk and Risk AversionE(x)x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 88. Increasing Risk and Risk AversionE(x) =x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 89. Increasing Risk and Risk AversionE(x) = px = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 90. Increasing Risk and Risk AversionE(x) = pxx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 91. Increasing Risk and Risk AversionE(x) = px1x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 92. Increasing Risk and Risk AversionE(x) = px1 +x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 93. Increasing Risk and Risk AversionE(x) = px1 + (x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 94. Increasing Risk and Risk AversionE(x) = px1 + (1x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 95. Increasing Risk and Risk AversionE(x) = px1 + (1-x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 96. Increasing Risk and Risk AversionE(x) = px1 + (1-px = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 97. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 98. Increasing Risk and Risk AversionE(x) = px1 + (1-p)xx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 99. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 100. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 101. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 102. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Vx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 103. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Vax = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 104. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Varx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 105. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 106. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(xx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 107. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x)x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 108. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) =x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 109. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = px = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 110. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 111. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(xx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 112. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 113. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1-x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 114. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1-x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 115. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 116. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 117. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 +x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 118. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 119. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 120. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 121. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-px = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 122. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p)x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 123. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 124. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (xx = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 125. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 126. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2-x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 127. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2-x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 128. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 129. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 130. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 =x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 131. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 =x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 132. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 133. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}
  • 134. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}i
  • 135. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is
  • 136. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a
  • 137. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a m
  • 138. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a me
  • 139. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a mea
  • 140. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a meas
  • 141. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measu
  • 142. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measur
  • 143. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure
  • 144. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure o
  • 145. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of
  • 146. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of c
  • 147. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of ce
  • 148. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of cen
  • 149. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of cent
  • 150. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of centr
  • 151. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of centra
  • 152. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central
  • 153. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central t
  • 154. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central te
  • 155. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central ten
  • 156. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tend
  • 157. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tende
  • 158. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tenden
  • 159. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendenc
  • 160. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency
  • 161. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.
  • 162. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.
  • 163. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2
  • 164. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 i
  • 165. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is
  • 166. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a
  • 167. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a m
  • 168. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a me
  • 169. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a mea
  • 170. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a meas
  • 171. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measu
  • 172. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measur
  • 173. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure
  • 174. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure o
  • 175. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of
  • 176. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of s
  • 177. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of sp
  • 178. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spr
  • 179. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spre
  • 180. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of sprea
  • 181. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread
  • 182. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (
  • 183. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (r
  • 184. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (ri
  • 185. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (ris
  • 186. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (risk
  • 187. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (riski
  • 188. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (riskin
  • 189. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (riskine
  • 190. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (riskines
  • 191. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (riskiness
  • 192. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (riskiness)
  • 193. Increasing Risk and Risk AversionE(x) = px1 + (1-p)x2 =Var(x) = p(x1- )2 + (1-p) (x2- )2 = 2x = (x1,x2) is a random variable.p = prob {x = x1} 1 - p = prob {x = x2}is a measure of central tendency.2 is a measure of spread (riskiness).
  • 194. M
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  • 209. More Drill Down On R
  • 210. More Drill Down On Ri
  • 211. More Drill Down On Ris
  • 212. More Drill Down On Risk
  • 213. More Drill Down On Risky
  • 214. More Drill Down On Risky =
  • 215. More Drill Down On Risky = (
  • 216. More Drill Down On Risky = (y
  • 217. More Drill Down On Risky = (y1
  • 218. More Drill Down On Risky = (y1,
  • 219. More Drill Down On Risky = (y1,y
  • 220. More Drill Down On Risky = (y1,y2
  • 221. More Drill Down On Risky = (y1,y2)
  • 222. More Drill Down On Risky = (y1,y2) i
  • 223. More Drill Down On Risky = (y1,y2) is
  • 224. More Drill Down On Risky = (y1,y2) is a
  • 225. More Drill Down On Risky = (y1,y2) is an
  • 226. More Drill Down On Risky = (y1,y2) is ano
  • 227. More Drill Down On Risky = (y1,y2) is anot
  • 228. More Drill Down On Risky = (y1,y2) is anoth
  • 229. More Drill Down On Risky = (y1,y2) is anothe
  • 230. More Drill Down On Risky = (y1,y2) is another
  • 231. More Drill Down On Risky = (y1,y2) is another r
  • 232. More Drill Down On Risky = (y1,y2) is another ra
  • 233. More Drill Down On Risky = (y1,y2) is another ran
  • 234. More Drill Down On Risky = (y1,y2) is another rand
  • 235. More Drill Down On Risky = (y1,y2) is another rando
  • 236. More Drill Down On Risky = (y1,y2) is another random
  • 237. More Drill Down On Risky = (y1,y2) is another random v
  • 238. More Drill Down On Risky = (y1,y2) is another random va
  • 239. More Drill Down On Risky = (y1,y2) is another random var
  • 240. More Drill Down On Risky = (y1,y2) is another random vari
  • 241. More Drill Down On Risky = (y1,y2) is another random varia
  • 242. More Drill Down On Risky = (y1,y2) is another random variab
  • 243. More Drill Down On Risky = (y1,y2) is another random variabl
  • 244. More Drill Down On Risky = (y1,y2) is another random variable
  • 245. More Drill Down On Risky = (y1,y2) is another random variable.
  • 246. More Drill Down On Risky = (y1,y2) is another random variable.S
  • 247. More Drill Down On Risky = (y1,y2) is another random variable.Su
  • 248. More Drill Down On Risky = (y1,y2) is another random variable.Sup
  • 249. More Drill Down On Risky = (y1,y2) is another random variable.Supp
  • 250. More Drill Down On Risky = (y1,y2) is another random variable.Suppo
  • 251. More Drill Down On Risky = (y1,y2) is another random variable.Suppos
  • 252. More Drill Down On Risky = (y1,y2) is another random variable.Suppose
  • 253. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p
  • 254. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p =
  • 255. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = p
  • 256. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = pr
  • 257. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = pro
  • 258. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob
  • 259. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {
  • 260. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y
  • 261. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y =
  • 262. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y
  • 263. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1
  • 264. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1}
  • 265. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} a
  • 266. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} an
  • 267. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and
  • 268. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E
  • 269. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(
  • 270. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x
  • 271. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x)
  • 272. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) =
  • 273. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E
  • 274. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(
  • 275. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y
  • 276. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y)
  • 277. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) =
  • 278. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) =
  • 279. More Drill Down On Risky = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 280. More Drill Down On RiskFy = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 281. More Drill Down On RiskFuy = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 282. More Drill Down On RiskFury = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 283. More Drill Down On RiskFurty = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 284. More Drill Down On RiskFurthy = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 285. More Drill Down On RiskFurthey = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 286. More Drill Down On RiskFurthery = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 287. More Drill Down On RiskFurther sy = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 288. More Drill Down On RiskFurther suy = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 289. More Drill Down On RiskFurther supy = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 290. More Drill Down On RiskFurther suppy = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .
  • 291. More Drill Down On RiskFurther suppoy = (y1,y2) is another random variable.Suppose p = prob {y = y1} and E(x) = E(y) = .