On the Planet Homogenia Every Consumer Who Has Ever Lived

question 26

Multiple Choice

On the planet Homogenia every consumer who has ever lived consumes only two goods, x and y, and has the utility function U(x, y) = xy. The currency in Homogenia is the fragel. In this country in 1900, the price of good 1 was 1 fragel and the price of good 2 was 2 fragels. Per capita income was 84 fragels. In 2000, the price of good 1 was 3 fragels and the price of good 2 was 4 fragels. The Laspeyres price index for the price level in 2000 relative to the price level in 1900 is

• A) 2.50.
• B) 3.50.
• C) 2.33.
• D) 4.
• E) not possible to determine from this information.

Understand the conditions under which trade can be beneficial or detrimental to individuals or countries.

Understand and calculate financial ratios to measure liquidity, profitability, and efficiency.

Apply the concept of the financial control process including its significance and types.

Analyze the concept of project management and its techniques.

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Definitions:

Budgeted Production

The quantity of goods or services that a company plans to produce during a specific period, as determined during budgeting.

Materials Inventory

The raw materials, work-in-process, and finished goods that a company holds at any given time for production.

Credit Sales

Sales made by a business where the payment is deferred to a later date, enabling customers to purchase goods or services on credit.

Cash Receipts

The collection of money, including coins, notes, electronic payments, etc., by a business from its customers or other transactions.