Consider the Following Three Concepts

question 8

Multiple Choice

Consider the following three concepts:
I. Marshallian Demand [x = x(p_x,,p_y ,I) ]
II. Indirect Utility [V = g (p_x,,p_y ,I) ]
III.Compensated Demand [x = x^c (p_x,,p_y ,U) ]
Which of these functions is necessarily homogeneous of degree zero in all its argument?

• A)All of them.
• B)None of them.
• C)Only I.
• D)I and III,but not II.

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Definitions:

Net Assets

The total assets of a company minus all of its liabilities, representing the owners' equity.

Liabilities

Obligations of a company or organization due to past transactions or events, resulting in the future sacrifice of economic benefits.

Stockholders' Equity

The ownership interest of shareholders in the assets of a corporation, after all liabilities have been subtracted.

Accounts Payable

The amounts owed by a business to its suppliers or creditors for goods and services received, representing short-term liabilities.