Pete and Dud Live in a Two-Commodity World

question 2

Multiple Choice

Pete and Dud live in a two-commodity world.Pete's utility function is U ^P(x ^P₁, x ^P₂) = x ^P₁x ^P₂.Dud's utility function is U ^D(x ^D₁, x ^D₂) = min{x ^D₁, x ^D₂}.Pete is initially endowed with 3 units of commodity 1 and 4 units of commodity 2.Dud is initially endowed with 7 units of commodity 1 and 6 units of commodity 2.

• A)Both consume 5 units of each good in competitive equilibrium.
• B)At competitive equilibrium, Dud consumes 6 units of each, since the 7th unit of his endowment of commodity 1 gives him no added utility.
• C)At a competitive equilibrium, Dud must consume equal amounts of both goods, so the price of good 1 must equal the price of good 2.
• D)The prices of the two goods cannot be equal in equilibrium since Pete and Dud do not have equal endowments.
• E)None of the above.

Understand the impact of commoditization on a brand and strategies to avoid it.

Interpret the significance of brand coolness, relevance, and authenticity in brand equity.

Understand the use of qualitative and quantitative research in building and measuring brand associations.

Recognize the importance and applications of ethnography and netnography in brand management.

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Definitions:

Immediate Feedback

Rapid response or information provided immediately after an action or behavior, used to reinforce or correct the action.

Achievement Motivation

A drive within individuals to accomplish goals, succeed according to standards, and overcome obstacles.

Standard Of Excellence

A benchmark of quality or achievement that is regarded as a model to aspire to or surpass.

Competitive Situations

Scenarios where individuals or groups compete against each other to achieve a particular objective or advantage.