Brenda maximizes expected utility. She assigns a utility of 0 to $0 and a
utility of 1 to $180. Her preferences are consistent with first order stochastic
dominance.
a. She is indifferent between receiving $60 with certainty and lottery A = ($0,
0.6; $180, 0.4). What is her utility for $60? Show your work.
b. She is indifferent between receiving $120 with certainty and lottery B = ($0,
025; $180, 0.75). What is her utility for $120? Show your work.