2
votes
1answer
154 views

Would a risk averse agent ever accept gambles with negative expected value? [closed]

Consider a risk-averse agent (his utility for money is strictly concave) that maximizes expected utility. Would such agent ever a accept a gamble whose expected value is negative? (e.g. think of state ...
1
vote
0answers
54 views

Using data points and a best-fit to find a function for quantity with respect to price

So I'm taking an entrepreneurship class, and we're doing a simulation where we run a donut shop. My math is pretty strong (integral and differential calculus level), so I'm trying to use my math ...
0
votes
1answer
77 views

Portfolio which replicates given payoff

Consider the following payoff function: $$p(S_T) = \begin{cases} 0 & \text{if } S_{T} \leq 70 \\ S_{T}-70 & \text{if } S_{T} \in (70; 100] \\ -S_{T}+120 & \text{if } S_{T} \in (100; 120] ...
1
vote
2answers
372 views

Application of maths in economics

What are the branches of maths where we can see undoubtful connections with economics? Where can we use mathematical methods or models and apply them to analyze economic concepts?
1
vote
1answer
271 views

Find a price vector p for various prices of industries.

( Leontief input-output model ) Suppose that three industries are interrelated so that their outputs are used as inputs by themselves, according to the $3 \times 3$ consumption matrix A = ...