A Child Is Given $4 of Pocket Money to Be

question 15

Multiple Choice

A child is given $4 of pocket money to be spent on either hard candies or chocolates. Chocolates cost 40 cents and hard candies 80 cents each. The marginal utilities derived from each product are as shown in the following table. Based on taste and preference alone, which good does the child prefer?

• A) chocolates
• B) hard candies
• C) The child equally likes chocolates and hard candies.
• D) One cannot tell from the given data.

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Definitions:

Merchant

An individual or business entity engaged in the sale of goods, particularly those specialized in a specific product or market.

UCC

An abbreviation for the Uniform Commercial Code, which is a comprehensive set of laws governing all commercial transactions in the United States.

Contract

A legally binding agreement between two or more parties that outlines obligations and rights concerning a particular service or product.

Without Reserve

An auction term indicating that the item will be sold to the highest bidder, with no minimum price set.