George Has $49 Which He Decides to Spend on X

question 6

Multiple Choice

George has $49 which he decides to spend on x and y. Commodity x costs $5 per unit and commodity y costs $11 per unit. He has the utility function U(x, y) = 3x² + 6y² and he can purchase fractional units of x and y. George will choose

• A) only y.
• B) some of each commodity but more x than y.
• C) only x.
• D) some of each commodity but more y than x.
• E) equal amounts of the two commodities.