In a Country with 100 People, Each Person Has a Utility

question 87

Multiple Choice

In a country with 100 people, each person has a utility function given by U = LY, where L is hours of leisure per day and Y is daily income. If each person earns $50 per day and enjoys 10 hours of leisure, what is the value of the utilitarian social welfare function for the country as a whole?

• A) 500
• B) 250
• C) 25,000
• D) 50,000

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Definitions:

Total Expenses

The sum of all costs and expenses incurred by a business during a given period, including operating and non-operating expenses.

Net Income

Net income is the profit a company makes after deducting all its costs and expenses from its total revenue.

Statement of Stockholders' Equity

A financial statement that shows the changes in the value of a company's equity over a specific period.

Common Stock

Shares of ownership in a corporation, granting holders voting rights and a portion of profits in the form of dividends.