Stochastic Dominance problem (2nd problem of Problem Set #4)

As I explain in my “Hints for Solving Problem Set #4”, the second problem on Problem Set #4 requires the application of the so-called stochastic dominance model. The stochastic dominance topic appears on pp. 53-56 of the Basic Economics: How Individuals Deal with Risk (Doherty, Chapter 2) reading, on page 3 of my Expected Utility, Mean-Variance, and Stochastic Dominance reading, and on pp. 8-18 of the Decision Making under Risk and Uncertainty, part 4 teaching note (which I plan to cover in class on Tuesday).

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