I have a question regarding utility functions:
Utility can be defined as follows:
x: What we want to find the utility for (Certain equivalent)
RT: Risk tolerance
My question is what conditions must be upheld in order for two persons to create the same utility functions for a bet?
Person A bet \$5 that horse number 1 wins. Person B bet \$20 that horse number 2 do not win. Is it then possible that their utility functions is the same given that their probabilities for horse 1 winning is the same and that they have the same risk tolerance?