Suppose That Paul and David Have Utility Functions U =

question 25

Multiple Choice

Suppose that Paul and David have utility functions U = 4A P + O P and U F= A D + 4O D, respectively, where A P and O P are Paul's consumptions of apples and oranges and A D and O D are David's consumptions of apples and oranges.The total supply of apples and oranges to be divided between them is 20 apples and 12 oranges.The fair allocations consist of all allocations satisfying the following conditions.

• A)A_D = A_P and O_D = O_P.
• B)8A_P + 2O_P is at least 92 and 2A_D + 8O_D is at least 68.
• C)4A_P + O_P is at least 92 and 2A_D + 4O_D is at least 68.
• D)A_D + O_D is at least 16 and A_S + O_S is at least 16.
• E)4A_P + O_P is at least A_D + 4O_D and A_D + 4O_D is at least 4A_P + O_P.

---

Definitions:

Efficiency

The extent to which resources such as energy, time, and money are well-used for the intended task or purpose, minimizing waste and maximizing outputs.

Employment Relationship

The formal linkage between employers and employees that dictates the terms of employment and is regulated by labor law and contract.

Profit Limitations

Restrictions or caps placed on the amount of profit that can be made, often in regulated industries or as part of economic policies.

Labor Law

The collection of laws, regulations, and prior judicial decisions that delineate the legal entitlements and limitations for employees and their unions.