Harry Mazzola Has the Utility Function U(x₁, X₂)= Min{x₁

question 7

Multiple Choice

Harry Mazzola has the utility function U(x₁, x₂) = min{x₁ + 2x₂, 2x₁ + x₂}.He has $40 to spend on corn chips and french fries.If the price of corn chips is $1 per unit and the price of french fries is $4, then Harry will

• A)consume at least as many french fries as corn chips but might consume both.
• B)consume at least as many corn chips as french fries but might consume both.
• C)definitely spend all of his income on corn chips.
• D)definitely spend all of his income on french fries.
• E)consume equal amounts of french fries and corn chips.

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Definitions:

Debts

Money owed by one party to another under an agreement to repay borrowed funds or services.

Stocks

Financial instruments representing ownership in a company or corporation, offering a claim to part of the corporation's assets and profits.

Equity Securities

Financial instruments representing ownership in a company, such as stocks, which give shareholders voting rights and potential dividends.

Ownership

The state or fact of legal possession and control over property, which can include goods, land, or intellectual property.