Astrid's Utility Function Is U(H_A, C_A)= H_AC_A

question 24

Multiple Choice

Astrid's utility function is U(H_A, C_A) = H_AC_A.Birger's utility function is min{H_B, C_B}.If Astrid's initial endowment is no cheese and 3 units of herring and if Birger's initial endowments are 13 units of cheese and no herring, then where p is a competitive equilibrium price of herring and cheese is the numeraire, demand equals supply in the herring market.This implies that

• A)13/3 = p.
• B)3/13 = p.
• C)13/p + 3/2p = 3.
• D)13/(p + 1)+ 1.50 = 3.
• E)min{3, 13} = p.

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Definitions:

Income Statement

A financial statement that provides a summary of a company's revenues, expenses, and profitability over a specific period.

Petty Cash Receipts

Petty cash receipts are documents that record the disbursements made from a petty cash fund for small, incidental expenses.

FIFO

"First In, First Out," an inventory valuation method where goods first bought are the first to be sold, affecting the costs reported in the financial statements.

Gross Profit

The difference between revenue and the cost of goods sold before deducting selling, general, and administrative expenses.