Quasilinear Preferences Are Homothetic When the Optimal Amount of One

question 7

True/False

Quasilinear preferences are homothetic when the optimal amount of one of the goods is not affordable.

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Definitions:

Legal Consequences

are the outcomes that follow from the application of the law, such as penalties for breaking the law or the results of legal judgments.

Liable

Responsible by law; legally obligated to compensate for harm or damage caused.

Contract

A contract recognized by law, involving at least two parties, each with obligations to the other.

Principal

The original amount of money invested or loaned, before interest, or the primary party engaged in a contract or transaction.