Morris Has the Utility Function U(b, W)= 4b + 16w

question 71

Multiple Choice

Morris has the utility function U(b, w) = 4b + 16w and Philip has the utility function U(b, w) = bw, where b is the number of books consumed per month and w is bottles of wine consumed per month.If we draw an Edgeworth box with books on the horizontal axis and wine on the vertical axis and if we measure Morris's consumptions from the lower left corner of the box, then the contract curve contains

• A)a straight line with slope 1/4 passing through the lower left corner of the box.
• B)a straight line running from the upper right corner of the box to the lower left.
• C)a straight line with slope 1/4 passing through the upper right corner of the box.
• D)a curve that gets steeper as you move from left to right.
• E)a curve that gets flatter as you move from left to right.

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