Suppose the Consumer's Utility Function Is Given By $U ( x , y ) = x y + y$

question 50

Multiple Choice

Suppose the consumer's utility function is given by $U ( x , y ) = x y + y$ where $\mathrm { MU } _ { \mathrm { x } } = \mathrm { y } \quad \mathrm { MU } _ { \mathrm { y } } = \mathrm { x } + 1$
The equation for this consumer's demand curve for $x$ when $\mathrm { I } > \mathrm { P } _ { \mathrm { x } }$ is:

• A) \(x ^ { d } = 0\)
• B) \(\mathrm { x } ^ { \mathrm { d } } = \frac { 1 } { 2 P _ { x } }\)
• C) \(x ^ { \mathrm { d } } = \frac { I } { 2 P _ { x } } - \frac { 1 } { 2 }\)
• D) \(x ^ { d } = 1 / 2\)

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Definitions:

Connective

A word or phrase in language that connects clauses or sentences, or a logical operator that joins propositions.

Coherent

Logically connected or consistent; in physics, waves having a constant phase relationship.

Consistent

Marked by harmony, regularity, or steady continuity; free from variation or contradiction.

Disjunction

A logical operation yielding a truth value of true if at least one of the operands is true; often represented with the word "or" in logic.