Madonna Buys Only Two Goods

question 36

Multiple Choice

Madonna buys only two goods.Her utility function is Cobb-Douglas.Her demand functions have which of the following properties?

• A)Her demand for one of the two goods does not depend on income.
• B)Her demand for neither good depends on income.
• C)Her demand for each of the goods depends on income and on the prices of both goods.
• D)Her demand for each of the two goods depends only on her income and on the price of that good itself.
• E)One of the goods is an inferior good and the other is a normal good.

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Definitions:

Need For Achievement

A psychological trait that signifies the drive or motivation to accomplish tasks and attain goals.

Incentive Value

The perceived worth or desirability of a reward that motivates behavior or encourages action towards a goal.

Low Expectation

A belief that a future event or outcome will likely be of lesser quality or significance.

Cognitive Components

Refers to the mental processes involved in perception, memory, and decision-making that contribute to an individual's ability to process information.