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

question 50

Multiple Choice

Harvey Habit has a utility function U(c₁, c₂) =min{c₁, c₂}.If he had an income of $1,230 in period 1 and $615 in period 2 and if the interest rate were 0.05, how much would Harvey choose to spend on bread in period 1?

• A)$1,860
• B)$465
• C)$1,395
• D)$310
• E)$930

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Definitions:

Evaporation

The process by which water transforms from a liquid to a gas or vapor, often driven by heat from the sun.

Seawater

The saltwater that makes up the oceans and seas, covering more than 70% of the Earth's surface.

Sediment

Particles of organic or inorganic matter that settle out of suspension in water, air, or ice, and accumulate in layers on the earth's surface.

Energetic Current

Refers to a strong, dynamic movement of water, often in the ocean, that can transport sediments and influence marine and coastal processes.