Which of the Following Must Be True About Functions in the Duality

question 28

Multiple Choice

Which of the following must be true about functions in the duality picture:

• A)The utility function is homogeneous of degree 1.
• B)The indirect utility function is homogeneous of degree 1 in income.
• C)The uncompensated demand functions are homogeneous of degree 1.
• D)Both (a) and (b).
• E)Both (b) and (c).
• F)Both (a) and (c)
• G)All of the above.
• H)None of the above.

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Definitions:

Invisible Hand

A term coined by economist Adam Smith to describe the self-regulating nature of the marketplace where individuals' pursuit of self-interest leads to societal benefits.

Capital Owners

Individuals or entities that own assets with economic value expected to benefit future operations, such as machinery, buildings, or equipment.

Government Failure

A situation where government interventions in the economy cause more harm than good, often due to inefficiencies, misallocation of resources, or unintended consequences.

Water Pollution

Contamination of water bodies such as rivers, lakes, oceans, and groundwater due to harmful substances, leading to detrimental effects on aquatic life and human health.