If We Use a Logarithmic Utility Function, the Marginal Utility $c ^ { a }$

question 40

Multiple Choice

If we use a logarithmic utility function, the marginal utility of consumption is:

• A) equal to c
• B) equal to \(c ^ { a }\)
• C) equal to \(a c ^ { a - 1 }\)
• D) one
• E) (1/c)

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Definitions:

C.I.F. Contract

Stands for "Cost, Insurance, and Freight," a type of international shipping agreement where the seller pays for the cost of goods, insurance, and freight to a specified destination.

F.O.B. Contract

A shipping agreement where "Free On Board" determines that the seller delivers goods on board a vessel designated by the buyer, transferring the risk from the seller to the buyer once the goods are onboard.

C.O.D. Contract

Contract of "Cash On Delivery" where payment for goods is made at the time of delivery rather than in advance.

Privity of Contract

A legal concept that restricts the parties who can sue or be sued under a contract to those who are a part of the contract agreement.