Mac's Utility Function Is U(x, Y) = Max{ 2x -

question 38

Multiple Choice

Mac's utility function is U(x, y) = max{ 2x - y, 2y - x}.

• A) Mac's preferences are quasilinear.
• B) If Mac has more x than y, any increase in his consumption of y would lower his utility.
• C) If Mac has more x than y, a decrease in his consumption of y would raise his utility.
• D) Mac always prefers more of each good to less.
• E) Goods x and y are perfect substitutes.

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Definitions:

Physical Arousal

The condition of being physiologically excited or stimulated, often associated with preparedness for physical activity.

Labeling

The process of assigning a category or descriptor to someone or something, which can influence perceptions and behaviors.

Context

The circumstances or background that surrounds and gives meaning to an event, statement, or idea.

Facial Feedback Hypothesis

The idea that sensory feedback from our facial expressions can affect our mood and emotions, influencing how we feel.