Jamal has a utility function U = W1/2, where W is his wealth in millions of dollars (which determines how much he gets to buy and consume over his lifetime) and U is the utility he obtains. a. Graph Jamals utility function. Is he risk averse? Explain. b. In the final stage of a game show, the host offers Jamal a choice between (A) $4 million for sure, or (B) a gamble that pays $1 million with probability 0.6 and $9 million with probability 0.4. Should Jamal pick A or B? Explain you reasoning with appropriate calculations. (Hint: The expected value of a random variable is the weighted average of the possible outcomes, where the probabilities are the weights.)

Management of Innovation – Week 2 Video : Choice, Happiness, & Spaghetti Sauce (TED TALK) o This video was to discuss the Food Industry and how the customer’s influence the business’s ideas of new products. o Prego Sauce was struggling as a product and in comparison to other sauces, was falling short yearly in sales. o Innovation was made when a man discovered that not all individuals want a thin pasta sauce and this is how the making of Chunky Prego Sauce was made. o When Chunky Prego Sauce was first put on the shelves, the sales of Prego sky-rocketed. o The same thing happened with Grey Poupon Mustard. It was sold in a small glass jar with old French writing and décor on the jar to m