Consider a consumer whose utility function for income is given by square root of x. this consumer is offered a choice between: (1) a certain outcome of obtaining $225 and (2) a risky gamble which generates either an outcome of x1=$100 with probability pr(x1)=0.5, or an outcome of x2=$400 with probability pr(x2)=0.5. which of the following statements is true?
a. such a person prefers option 1 and she is risk averse. b. she is risk averse but still prefers option 2 since the expected value is higher c. such a person is indifferent between both option so that makes her risk neutral d. such a person is indifferent between the two choices and is risk averse. e. she prefers option 2 so that makes her risk loving.