What is the difference between absolute and relative risk aversion?
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It’s very important to understand relative risk/change vs. absolute risk/change. News outlets often take advantage of the fact that many people may not understand this in order to publish attention grabbing headlines. Relative change - By what percentage (larger or smaller) did the number change from the original number? Absolute change - What is the difference between the original number and the new one? If someone tells you something contains x% more or less or increases or decreases risk by x
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