the purpose of this study was to compare various direct techniques of measuring attitudes toward risk. the equally likely certainty equivalent with a purely hypothetical risky prospect (elce-ph), the equally likely certainty equivalent with a hypothetical but realistic risky prospect (elce-r) and probability of winning demanded (pwd) models were used to elicit the risk attitude of a sample ...

Revenue management techniques, practiced for many years in the airline and hotel industries, have gained popularity with retailers. One such technique — dynamic pricing — refers to the intelligent process of controlling prices over a course of a sales season in a way that maximizes expected revenues. In this paper, we consider a retailer who sells a fashionable good during a short sales season,...

Note that, when η = 0, ci is simply the expected income of i. We then calculate the inequality-neutral certainty-equivalent income loss. To do this, we find the equalpercentage loss that, if forfeited by all agents with certainty, yields the same welfare as the actual crosssectional distribution of certainty equivalent losses ci . Denoting the inequality-neutral certainty-equivalent income loss...

This paper attempts to determine the certainty equivalent of an uncertain future cash flow or value through the option pricing method, and builds models of certainty equivalent and certainty equivalent coefficient. Based on the model of certainty equivalent coefficient, this paper further derives models of risk premium and risk-adjusted discount rate. The latter is a new capital asset pricing m...

In this paper, we consider the relationship between supermodularity and risk aversion. We show that supermodularity of the certainty equivalent implies that the certainty equivalent of any random variable is less than its mean. We also derive conditions under which supermodularity of the certainty equivalent is equivalent to aversion to mean-preserving spreads in the sense of Rothschild and Sti...