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  2. Describe the methodology employed by Dohmen et al. (2011) to measure individual risk preferences and outline the main findings of the study.

Describe the methodology employed by Dohmen et al. (2011) to measure individual risk preferences and outline the main findings of the study.

Description

Consider the following five rows of choices between lottery A and lottery B. Based

on these, discuss what would be the choices of risk-averse, risk-neutral, or riskseeking individuals over the five rows.

Row Lottery A Lottery B

1 Win €110 or €0 with 50% probability Win €15 with 100% probability

2 Win €110 or €0 with 50% probability Win €35 with 100% probability

3 Win €110 or €0 with 50% probability Win €55 with 100% probability

4 Win €110 or €0 with 50% probability Win €75 with 100% probability

5 Win €110 or €0 with 50% probability Win €95 with 100% probability

Describe the methodology employed by Dohmen et al. (2011) to measure individual

risk preferences and outline the main findings of the study.


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