Equilibrium of a Risk-Averse Person | Investment
Let us suppose that the budget line of two persons are the same—this line is given in Fig. 7.7. Let us also suppose that one of these persons (A) is more risk-averse than the other (B). Therefore, the ICs of A would be steeper like ICA than those of B whose ICs would be like ICB. Now, since A's ICs [...]