Suppose for a Utility Function That the Marginal Utility for Good

question 77

Multiple Choice

Suppose for a utility function that the marginal utility for good is given by $\mathrm { MUx } = 5 \mathrm { y } 2 / \mathrm { x }$ . Which of the following is correct?

• A)The more is better assumption is not satisfied for in this utility function.
• B)The more is better assumption is satisfied for in this utility function.
• C)This shows a positive and increasing marginal utility of x.
• D)The marginal rate of substitution must be diminishing.

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Definitions:

Book Value

The net value of a company's assets, as recorded on the balance sheet, minus its liabilities and intangible assets.

Equity Capital

Funds raised by a company through the issuance of shares, representing ownership interest in the company.

Share Price

The current market price of a company's share, reflecting its perceived value by investors.

Book Value

The net value of a company's assets less its liabilities and intangible assets.