MrOBKandle Has a Utility Function C₁c₂, Where C₁ Is

question 17

Multiple Choice

Mr.O.B.Kandle has a utility function c₁c₂, where c₁ is his consumption in period 1 and c₂ is his consumption in period 2.He has no income in period 2.If he had an income of $40,000 in period 1 and the interest rate increased from 10 to 19%,

• A)his savings would not change but his consumption in period 2 would increase by 1,800.
• B)his savings would increase by 9% and his consumption in period 2 would also increase.
• C)his consumption in both periods would decrease.
• D)his consumption in both periods would increase.
• E)his consumption in period 1 would decrease by 19% and his consumption in period 2 would also decrease.

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Definitions:

Random Sampling

A technique for selecting a sample from a population in a way that every individual has an equal chance of being chosen.

Random Assignment

A method used in experiments to place participants into different groups in a way that every individual has an equal chance of being assigned to any group, ensuring the fairness and validity of the research.

Correlational Studies

Research methods that examine the relationship between variables without determining cause and effect.

Noise Levels

The intensity of sounds in a particular environment, measured in decibels.