If Bernice (Whose Utility Function Is Min{x, Y}, Where X

question 24

Multiple Choice

If Bernice (whose utility function is min{x, y}, where x is her consumption of earrings and y is money left for other stuff) had an income of $10 and was paying a price of $3 for earrings when the price of earrings went up to $4, then the equivalent variation of the price change was

• A)$2.
• B)$2.50.
• C)$5.
• D)$1.
• E)$2.25.

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Definitions:

Freud

An Austrian neurologist named Sigmund Freud created psychoanalysis, a therapeutic approach that treats mental illnesses by facilitating discussions between a patient and a psychoanalyst.

Superego

A component of Freud's psychoanalytic theory of personality, representing the moral conscience and ideal standards imposed by society and parents.

Adolescence

The period of life from about age 13 to the early 20s, during which a young person is no longer physically a child but is not yet an independent, self-supporting adult.

Superego

A component of Freud's psychoanalytic theory, representing the moral conscience and the ideals of parents and society.