Lucy's Utility Function Is 2X_L + G and Melvin's Utility

question 15

Multiple Choice

Lucy's utility function is 2X_L + G and Melvin's utility function is X_MG, where G is their expenditures on the public goods they share in their apartment and where X_L and X_M are their respective private consumption expenditures.The total amount they have to spend on private goods and public goods is $24,000.They agree on a Pareto optimal pattern of expenditures in which the amount that is spent on Lucy's private consumption is $9,000.How much do they spend on public goods?

• A)$5,000
• B)$10,000
• C)$7,050
• D)$2,500
• E)There is not enough information here to be able to determine the answer.

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Definitions:

Flynn Effect

The observed rise over time in standardized intelligence test scores, attributed to various factors including improved nutrition, education, and test-taking strategies.

Standardized

Consistent and uniform procedures applied in testing or assessment to ensure fairness and comparability of data or results.

Generations

Refers to all of the people born and living at about the same time, regarded collectively, often used to categorize specific cohorts in sociology, like Baby Boomers or Millennials.

Flynn Effect

The observed rise over time in standardized intelligence tests scores, attributed to various factors including improved nutrition and education.