Suppose Music CDs and Movie DVDs Give the Same Utility

question 85

Multiple Choice

Suppose music CDs and movie DVDs give the same utility to Jane, and she has $200 to spend on music CDs and movie DVDs. The price of a movie DVD is $15, and the price of a music CD is $10. Which of the following is the most affordable bundle for maximizing her utility?

• A)10 music CDs and 5 movie DVDs
• B)10 music CDs and 10 movie DVDs
• C)5 music CDs and 5 movie DVDs
• D)15 music CDs and 5 movie DVDs
• E)5 music CDs and 10 movie DVDs

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Definitions:

Recognizes

To acknowledge or take notice of in some definite way, often with respect to legal, official, or formal status.

Legitimacy

The general acceptance and recognition of an authority, usually a governing law or a regime, by the public.

Territorial Claims

Declarations by a country asserting sovereignty over an area, often based on historical or legal grounds.

Executive Agreements

Agreements between the head of government of one state and the government of another that are less formal than treaties and do not require legislative approval.