Problem 3 Richard Risky bets some money on the result of a tennis game. If he wins his bet, he will get 200 and if he looses his bet, he will go home...

Problem 3Richard Risky bets some money on the result of a tennis game. If he wins his bet, he will get200€ and if he looses his bet, he will go home with only 20€. The probability of winning hisbet is ⅓ and the probability of losing his bet is ⅔. His utility function is given by u(x) = x4/3 .a) Is Richard Risky risk-averse?b) Calculate the certainty equivalent of his bet!c) Compute the Arrow-Pratt measure of absolute and relative risk aversion!d) Calculate Richard Risky’s risk premium! Why is it difficult to model agents withRichard’s risk attitude in an economic context?