Harvey Habit Has a Utility Function U(c₁, C₂)= Min{c₁

question 26

Multiple Choice

Harvey Habit has a utility function U(c₁, c₂) = min{c₁, c₂}.If he had an income of $420 in period 1 and $1,050 in period 2 and if the interest rate were 10%, how much would Harvey choose to spend on bread in period 1?

• A)$240
• B)$360
• C)$1,440
• D)$1,080
• E)$720

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