Suppose That Romeo Has the Utility Function U =

question 20

Multiple Choice

Suppose that Romeo has the utility function U = S ³_RS¹_J and Juliet has the utility function U = S¹_RS ³_J, where S_R is Romeo's spaghetti consumption and S_J is Juliet's.They have 36 units of spaghetti to divide between them.

• A)Romeo and Juliet would never disagree about how to divide the spaghetti.
• B)Romeo would want to give Juliet some spaghetti if he had more than 18 units of spaghetti.
• C)Juliet would want to give Romeo some spaghetti if she has more than 25 units.
• D)Romeo would want to give Juliet some spaghetti if he has more than 23 units of spaghetti.
• E)Juliet would want to give Romeo some spaghetti if she has more than 27 units of spaghetti.

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Definitions:

Usage Of Trade

Established customs and practices in a particular industry that are considered to be an understood part of business agreements.

Sequence

An ordered list or arrangement of items, events, or actions following a specific logical or systematic pattern.

Predominant Factor Test

A legal doctrine used to classify a transaction within the framework of the Uniform Commercial Code (UCC) by determining the main purpose of the contract.

Liberally Administered

A principle or policy applied in a manner that is flexible, generous, or not strictly in accordance with strict rules or formalities.