(See Problem 2

question 3

Multiple Choice

(See Problem 2.) Robinson Crusoe has exactly 8 hours per day to spend gathering coconuts or catching fish. He can catch 4 fish per hour or he can pick 8 coconuts per hour. His utility function is U(F, C) = FC, where F is his consumption of fish and C is his consumption of coconuts. If he allocates his time in the best possible way between catching fish and picking coconuts, his consumption will be the same as it would be if he could buy fish and coconuts in a competitive market where the price of coconuts is $1, his income is

• A) $96 and the price of fish is $4.
• B) $64 and the price of fish is $.25.
• C) $32 and the price of fish is $4.
• D) $64 and the price of fish is $2.
• E) $48 and the price of fish is $.25.

---

Definitions:

Employee Motivation

The level of commitment, drive, and energy that a company's workers bring to their jobs in order to contribute to the organization's success.

Employee Stock Ownership Plan

A program that gives employees the opportunity to buy shares in the company they work for, often at a discounted price.

Company's Stock

Represents ownership shares in a corporation, giving holders a claim on parts of the company's assets and earnings.

Minimum Percentage

The lowest allowable or required fraction or rate of a quantity, often set as a standard or threshold.