Use the Following to Answer Questions $\text { Table: Utility from Candy Bars and Colas }$

question 132

Multiple Choice

Use the following to answer questions : $\text { Table: Utility from Candy Bars and Colas }$
$\begin{array}{lccc}\begin{array}{l}\text { Units of } \\\text { Candy Bars }\end{array} & \boldsymbol{M} \boldsymbol{C}_{\text {Candy }} & \begin{array}{c}\text { Units of } \\\text { Colas }\end{array} & \boldsymbol{M} \boldsymbol{U}_{\text {Colas }} \\\hline 1 & 8 & 1 & 10 \\2 & 7 & 2 & 8 \\3 & 6 & 3 & 6 \\4 & 5 & 4 & 4 \\5 & 4 & 5 & 3 \\6 & 3 & 6 & 2 \\7 & 2 & 7 & 1 \\8 & 1 & 8 & 0\end{array}$
-(Table: Utility from Candy Bars and Colas) Use Table: Utility from Candy Bars and Colas.Stan's daily income is $11,the price of a candy bar is $2,and the price of a cola is $1.Given this budget constraint,Stan will receive the MOST utils from consuming _____ candy bar(s) and _____ colas.

• A) three;five
• B) one;four
• C) five;six
• D) two;seven

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Definitions:

Discount Rate

The interest rate used in discounted cash flow analysis to determine the present value of future cash flows.

Net Present Value

The difference between the present value of cash inflows and outflows over a period of time, used in capital budgeting to assess profitability of investments.

Cash Inflows

Money received by a business from its operational, financing, or investing activities.

Payback Period

The time it takes for an investment to generate an amount of income or cash equal to the cost of the investment.