Waldo's Utility Function Is U(x, Y) = Xy

question 45

Multiple Choice

Waldo's utility function is U(x, y) = xy. Waldo consumes 5 units of x and 25 units of y.

• A) Waldo would be willing to make small exchanges of x for y in which he would give up 5 units of x for every unit of y he got.
• B) Waldo would be willing to trade away all of his x for y as long as he got more than 5 units of y for every unit of x he gave up.
• C) Waldo likes x and y equally well so he is always willing to exchange 1 unit of either good for more than 1 unit of the other.
• D) Waldo will always be willing to make trades at any price if he does not have equal amounts of the two goods.
• E) None of the above.

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Definitions:

Pheromones

Substances created and emitted by an animal into the surroundings that influence the behavior or physical state of other members of its species.

Chemical Signals

Molecules released by organisms to communicate with each other, influencing behavior, physiology, or development.

Bloodstream

The flowing blood within the circulatory system of a body, responsible for transporting oxygen, nutrients, and wastes to and from cells.

Mating Systems

The patterns or strategies of reproduction, including the formation of pair bonds, that species follow to ensure the survival of their genes.