Charlie's Utility Function Is U(x_A, X_B) = X_Ax_B

question 10

Multiple Choice

Charlie's utility function is U(x_A, x_B) = x_Ax_B. If Charlie's income were $40, the price of apples were $5, and the price of bananas were $8, how many apples would there be in the best bundle that Charlie could afford?

• A) 8
• B) 11
• C) 10
• D) 15
• E) 4

---

Definitions:

Promisee

The person to whom a promise is made or directed in a contract, opposite to the promisor.

Promisor

The individual or party in a contract who makes a promise to perform an act or service.

Promisee

The party in a contract to whom a promise is made by another party (the promisor), and who stands to benefit from the fulfillment of that promise.

State Common Law

The body of law developed through court decisions and precedent, as opposed to laws enacted by a legislative body, within a particular state.