On a Certain Island There Are Only Two Goods, Wheat

question 9

Multiple Choice

On a certain island there are only two goods, wheat and milk.The only scarce resource is land.There are 1,000 acres of land.An acre of land will produce either 3 units of milk or 7 units of wheat.Some citizens have lots of land; some have just a little bit.The citizens of the island all have utility functions of the form U(M, W) = MW.At every Pareto optimal allocation,

• A)the number of units of milk produced equals the number of units of wheat produced.
• B)all citizens consume the same commodity bundle.
• C)total milk production is 1,500 units.
• D)every consumer's marginal rate of substitution between milk and wheat is -1.
• E)None of the above is true at every Pareto optimal allocation.

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Definitions:

Level Of Greed

The intensity of an individual's or group's desire to acquire more resources or wealth than what might be considered necessary or fair.

Entitlement

In relation to unethical behavior by executives, the idea that some CEOs lose their sense of reality and feel entitled to whatever they can get away with or steal.

Unethical Behavior

Actions or practices that are morally wrong, violating the principles of fairness, honesty, or respect in a professional or personal context.

Corporate Executives

Individuals who hold senior management positions within a company, responsible for making the major corporate decisions.