The Utility Function U(x,y)= 2x + Y Is an Apt

question 14

Multiple Choice

The utility function U(x,y) = 2x + y is an apt description of the preferences when:

• A)x is a left shoe and y is a right shoe.
• B)x is nickels and y is quarters.
• C)x is nickels and y is dimes.
• D)x is pizza and y is cola.

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Definitions:

Demand for Investment

The amount of spending on investment goods, such as machinery and buildings, that businesses and governments are willing to undertake at various interest rates.

Government Budget Deficit

The financial situation that occurs when a government spends more money than it receives in revenue over a given fiscal period.

Interest Rate

The number of dollars earned per dollar invested per period.

Real Rate

The rate of interest an investor expects to receive after allowing for inflation, reflecting the true cost of borrowing and the true yield on investments.