Hei. Jeg lurer på om noen kan hjelpe meg med denne oppgaven:
A person has a (Bernoulli) utility function u(w)= w^1/2. She has initial
wealth w, and may place all or parts of it in a safe asset yielding zero rate of real interest, or
invest in a project P that will yield a risky payment. She cannot loan funds. The present
value of the payment per dollar invested is
1 + x with probability p1 > 0
1 − x with probability p2 =1 − p1 > 0.
where 0 < x ≤ 1. Find the optimal amount invested (alfa), and discuss briefly how it
varies with the parameters w, x and p1.
