In Problem 1, Suppose That Morris Has the Utility Function

question 15

Multiple Choice

In Problem 1, suppose that Morris has the utility function U(b, w) = 4b + 4w and Philip has the utility function U(b, w) = bw. If we draw an Edgeworth box with books on the horizontal axis and wine on the vertical axis and if we measure Morris's consumptions from the lower left corner of the box, then the contract curve contains

• A) a straight line running from the upper right corner of the box to the lower left.
• B) a curve that gets steeper as you move from left to right.
• C) a straight line with slopepassing through the lower left corner of the box.
• D) a straight line with slopepassing through the upper right corner of the box.
• E) a curve that gets flatter as you move from left to right.

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Definitions:

Equivalent Statements

Statements that are logically similar in that they always have the same truth value in every possible scenario.

Conjunction

In logic, a connective that combines multiple statements or propositions to form a single proposition that is true only if all its components are true.

Contradictory Statements

Assertions that are directly opposed to each other, so that if one is true, the other must be false.

Truth Tables

A mathematical table used in logic to compute the functional values of logical expressions on each of their functional arguments, showing all possible conditions.