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Bernice Has the Utility Function U(x, Y)= Min{x, Y}, Where

question 17

Multiple Choice

Bernice has the utility function u(x, y) = min{x, y}, where x is the number of pairs of earrings she buys per week and y is the number of dollars per week she has left to spend on other things.(We allow the possibility that she buys fractional numbers of pairs of earrings per week.) If she originally had an income of $10 per week and was paying a price of $8 per pair of earrings, then if the price of earrings rose to $13 per pair, the compensating variation of that price change (measured in dollars per week) would be closest to

Explain the concept of opportunity cost and its relationship to the PPF.

Identify factors that can shift or rotate the PPF.

Understand the principle of increasing opportunity costs and its representation on the PPF.

Recognize points of efficiency, inefficiency, and unemployment on the PPF.

Definitions:

Skeletal Muscles

These are muscles attached to bones that are responsible for voluntary movements of the body.

Duodenum

First division of the small intestine; connects to the stomach.

Anterior Pituitary

The front portion of the pituitary gland that secretes hormones affecting growth, metabolism, and reproductive functions.

Adrenal Glands

Endocrine glands located above the kidneys that produce hormones such as adrenaline and cortisol, involved in stress responses.