Suppose the Price of a Pair of Jeans Is $20

question 21

Multiple Choice

Suppose the price of a pair of jeans is $20 and the price of a T-shirt is $10. Suppose further that a consumer can spend a maximum of $100 on T-shirts and jeans. Which of the following is the most affordable bundle for maximizing the consumer's utility?

• A)10 T-shirts and 5 pairs of jeans
• B)2 T-shirts and 4 pairs of jeans
• C)4 T-shirts and 2 pairs of jeans
• D)Only 4 pairs of jeans
• E)5 T-shirts and 10 pairs of jeans

Explore the misapplications and potential errors in judgment arising from specific heuristics.

Compare and contrast System-1 and System-2 thinking in the context of human decision making.

Discuss the implications of heuristic misapplications in real-life scenarios.

Evaluate the consequences of risk and loss aversion in decision making.

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Definitions:

EFTA

The European Free Trade Association, an intergovernmental organization promoting free trade and economic integration to the benefit of its four European member states.

Unauthorized Use

The improper or illegal use of something without permission or beyond the scope granted by its owner or governing rules.

Legal Relations

Refers to the legally enforceable relationships between individuals or entities, governed by laws and statutes.

Principal's Affairs

Matters or business activities that are managed or acted upon by an agent on behalf of a principal.