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Basic Question 14 of 16
Which statement is true?
II. Utility can be compared among different investors.
I. For an investor, a portfolio with a utility of 10 is 5 times better than a portfolio with a utility of 2.
II. Utility can be compared among different investors.
User Contributed Comments 4
| User | Comment |
|---|---|
| schweitzdm | How is 1 false? The AN notes state: "it is possible to assign a utility score to any portfolio" A utility score will differ from person to person, but for John Doe, he could use utility scores to rank the two portfolios, couldn't he? |
| charliedba | You can assign an utility score but you cannot say 10 is 5 times better than 2. |
| sangiljin | Utility score is "ordinal" or "interval", not "ratio". |
| chesschh | UTILITY THEORY IS A MATTER OF RISK TOLERANCE, NOT WHICH IS GREATER |
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