Kenny Kink's Utility Function Is U(c₁, C₂)=min{c₁, C₂}, Where C₁

question 15

Multiple Choice

Kenny Kink's utility function is u(c₁, c₂) =min{c₁, c₂}, where c₁ is his consumption in period 1 and c₂ is his consumption in period 2.He earns $200 in period 1 and $220 in period 2.Kenny can borrow and lend at an interest rate of 10%, and there is no inflation.The number of dollars that Kenny spends on consumption in the first period must be

• A)more than 200 but less than 220.
• B)exactly 200.
• C)more than 220.
• D)exactly 180.
• E)more than 180 but less than 200.