Elmer's Utility Function Is U(x, Y) = Min{x, Y²}

question 62

Multiple Choice

Elmer's utility function is U(x, y) = min{x, y²}. If the price of x is $25 and the price of y is $15 and if Elmer chooses to consume 7 units of y, what must his income be?

• A) $2,660
• B) $280
• C) $1,430
• D) $1,330
• E) There is not enough information to determine his income.

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Definitions:

Contributions Credit

Contributions credit generally refers to tax credits available for contributions to certain types of saving plans or charitable organizations.

Qualified Retirement Plan

A retirement savings plan recognized by the IRS that offers tax benefits to both employers and employees.

Child Tax Credit

A tax credit available to taxpayers for each qualifying dependent child, aimed at reducing the taxpayer's liability.

AGI

Adjusted Gross Income (AGI) is a measure of income calculated from your gross income and allows for certain deductions, serving as a basis for calculating taxable income.