Final answer:True. Individuals and organizations indeed measure risk/return with expected utility, utilizing theories and mathematical models to understand and quantify the tradeoffs between risk and return in investment decisions.Explanation:Individuals and organizations measure risk/return with expected utility: True. The concept of expected utility plays a crucial role in making decisions under uncertainty. By adopting models like the von Neumann-Morgenstern utility function and considering theories such as constant absolute risk aversion (CARA), individuals and organizations can translate risks into quantifiable metrics. These metrics, like risk premium, help in calculating the desirability of various investment options based on their expected outcomes and the investors' attitudes towards risk. This process effectively assesses the tradeoff between return and risk, guiding financial decisions and investments strategies.Understanding the expected utility and its implications on financial decisions is vital for those involved in economic and business activities. It determines how different time frames and personal preferences influence the balance between securing safe investments and pursuing opportunities with higher returns but greater risk. In essence, expected utility theory aids in making informed choices by evaluating the anticipated satisfaction or utility from risky ventures, thereby supporting strategic investment planning....

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