Suppose That Mutt's Utility Function Is U(m, J)= Max{4m, J}

question 28

Multiple Choice

Suppose that Mutt's utility function is U(m, j) = max{4m, j} and Jeff's utility function is U(m, j) = 3m + j.Mutt is initially endowed with 6 units of milk and 2 units of juice, and Jeff is initially endowed with 2 units of milk and 6 units of juice.If we draw an Edgeworth box with milk on the horizontal axis and juice on the vertical axis and if we measure goods for Mutt by the distance from the lower left corner of the box, then the set of Pareto optimal allocations includes the

• A)right edge of the Edgeworth box but no other edges.
• B)left edge of the Edgeworth box but no other edges.
• C)bottom edge of the Edgeworth box but no other edges.
• D)left edge and bottom edge of the Edgeworth box.
• E)right edge and top edge of the Edgeworth box.

---

Definitions:

Photograph Cover

The front image or picture on a magazine, book, or album designed to represent its contents or appeal to consumers.

Chi-square Statistic

A statistic that measures the difference between observed frequencies in a sample and the frequencies that would be expected by chance.

Null Hypothesis

A statement that there is no effect or no difference, and it is the statement being tested in statistical hypothesis testing.

Economic Concerns

Issues related to the health and functioning of an economy, including inflation, unemployment, and GDP growth.