Joe's Utility Function Is Given by U(x,y)= Min[x,y]

question 13

Multiple Choice

Joe's utility function is given by U(x,y) = min[x,y]. The price of x is $4 and the price of y is $2 and Joe's income is $12. If the price of x decreases to $2 but Joe's income stays constant, then:

• A)the substitution effect is equal to 3.
• B)the substitution effect is equal to 2.
• C)the substitution effect is zero.
• D)the substitution effect is equal to 1.

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Definitions:

Cultural Sensitivity

An awareness, understanding, and respect toward the differences and similarities within and between cultures.

Socioeconomic Status

A measure of an individual's or family's economic and social position based on income, education, and occupation, often used in studies related to health and education outcomes.

Spanish-speaking

Relating to or denoting people or communities that communicate in Spanish as their primary language.

Population Trends

General patterns or movements in population growth, distribution, age composition, or other demographic factors over time.