Mr Inflexible's Utility Function Is U(x₁,x₂)= Min(x_1,x₂)

question 26

Multiple Choice

Mr. Inflexible's utility function is U(x₁,x₂) = min(x_1,x₂) . The price of x₁ is $1, the price of x₂ is $2, and Mr. Inflexible's budget is $120. If Mr. Inflexible were given the choice between a lump- sum tax and an excise tax which raised the same amount of tax revenue, then:

• A)he would prefer the excise tax.
• B)he would prefer the lump- sum tax.
• C)he would be indifferent between them.
• D)one cannot say which tax he would prefer.

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Definitions:

Core Time

Defined periods during the working day when employees are required to be at work, facilitating a common schedule for collaboration while allowing some flexibility.

Flex-Time System

An employment schedule that allows workers to alter their start and end times, offering flexibility to accommodate personal needs and preferences.

Work Sharing

A strategy aiming to reduce layoffs during slow periods by enabling employees to work reduced hours while partly compensating their reduced earnings with unemployment benefits.

Weekly Hours

The number of hours scheduled for work or assignment within a week.