Lucy's Utility Function Is 2X_L + G and Melvin's Utility

question 7

Multiple Choice

Lucy's utility function is 2X_L + G and Melvin's utility function is X_MG, where G is their expenditures on the public goods they share in their apartment and where X_L and X_M are their respective private consumption expenditures. The total amount they have to spend on private goods and public goods is $33,000. They agree on a Pareto optimal pattern of expenditures in which the amount that is spent on Lucy's private consumption is $9,000. How much do they spent on public goods?

• A) $4,000
• B) $16,000
• C) $8,550
• D) $8,000
• E) There is not enough information here to be able to determine the answer.

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Definitions:

Retention

The ability to keep or hold onto information or knowledge over time.

Recognition

The ability to identify previously encountered items, events, or people, demonstrating memory of those items, events, or people.

Sensory Registers

Memory stores that briefly hold sensory information from the environment, such as sights and sounds, before it is processed further or forgotten.

Auditory and Visual

Pertaining to the senses of hearing and sight, often in the context of learning or perception.