Allais paradox and Ellsberg paradox.

The Allais paradox and the Ellsberg paradox are two famous phenomena in the field of behavioral economics and decision theory that challenge the classical economic assumptions of rational decision-making under uncertainty.

1. Allais Paradox:

   • The Allais paradox, named after the French economist Maurice Allais, demonstrates a situation in which individuals make choices that seem inconsistent with expected utility theory, a fundamental concept in classical economics.
   • Expected utility theory posits that individuals make decisions based on the expected value and utility (satisfaction or happiness) associated with different outcomes. People are assumed to be risk-averse and make choices that maximize their expected _______ _____ _______ _______ ___ ________.
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