Exploring the Characteristics and Applications of Constant Relative Risk Aversion Utility Functions

Introduction

This report explores the characteristics and applications of Constant Relative Risk Aversion (CRRA) utility functions, a cornerstone in economic theory and decision-making under uncertainty. The purpose of this report is to elucidate the theoretical underpinnings of CRRA utility functions, their mathematical properties, and their practical implications in various fields such as economics, finance, and behavioral science. By delving into these as