Logarithmic Utility Function. Suppose that a person's utility function is L/(_r) =
I _ _ . ,
log(x Q- 4) for x > 4. Since limxA_,, log(x + 4) = -oo, a person who has this utility
function cannot choose a gamble in which there is any possibility of her gain being -4
or less. For the gambles X and Y defined by Eqs. (4.95) and (4.9.6),