Donald derives utility from only two goods, carrots (X) and donuts (Y). His utility 0.1 0.9 function is as follows: U(X,Y) =X Y and donuts (P) are $45 and $90 respectively. Based on this information, what does the slope of the indifference curve for Donald tell us. . Donald has an income (M) of $900 and the price of carrots (P (P) Select one: A. For each additional quantity of carrot consumed, Donald must give up 0.25 of donuts to maintain the same level of satisfaction B. For each additional quantity of donuts consumed, Donald must give up 1/2 of carrots to maintain the same level of satisfaction C. For each additional quantity of carrot consumed, Donald must give up 1/2 of donuts to maintain the same level of satisfaction D. For each additional quantity of carrot.consumed, Donald must give up 1/9 of donuts to maintain the same level of satisfaction E. For each additional quantity of donuts consumed. Donald must give up 1/2 of carrots to maintain the same level of satisfaction. F. For each additional quantity of carrots consumed, Donald must give up 9 units of donuts to maintain the same level of satisfaction G. For each additional quantity of donüts consumed. Donald must give up 1/9 of carrots to maintain the same level of satisfaction H. For each additional quantity of donutS consumed. Donald must give up 9 units of carrots to maintain the same level of satisfaction
Donald derives utility from only two goods, carrots (X) and donuts (Y). His utility 0.1 0.9 function is as follows: U(X,Y) =X Y and donuts (P) are $45 and $90 respectively. Based on this information, what does the slope of the indifference curve for Donald tell us. . Donald has an income (M) of $900 and the price of carrots (P (P) Select one: A. For each additional quantity of carrot consumed, Donald must give up 0.25 of donuts to maintain the same level of satisfaction B. For each additional quantity of donuts consumed, Donald must give up 1/2 of carrots to maintain the same level of satisfaction C. For each additional quantity of carrot consumed, Donald must give up 1/2 of donuts to maintain the same level of satisfaction D. For each additional quantity of carrot.consumed, Donald must give up 1/9 of donuts to maintain the same level of satisfaction E. For each additional quantity of donuts consumed. Donald must give up 1/2 of carrots to maintain the same level of satisfaction. F. For each additional quantity of carrots consumed, Donald must give up 9 units of donuts to maintain the same level of satisfaction G. For each additional quantity of donüts consumed. Donald must give up 1/9 of carrots to maintain the same level of satisfaction H. For each additional quantity of donutS consumed. Donald must give up 9 units of carrots to maintain the same level of satisfaction
Chapter3: Preferences And Utility
Section: Chapter Questions
Problem 3.7P
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Transcribed Image Text:Donald derives utility from only two goods, carrots (X) and donuts (Y). His utility
0.1 0.9
function is as follows: U(X,Y) =X Y Donald has an income (M) of $900 and the price of carrots (P,)
and donuts (P,) are $45 and $90 respectively Based on this information, what does the slope of the
indifference curve for Donald tell us.
Select one:
A. For each additional quantity of carrot consumed, Donald must give up 0.25 of donuts to
maintain the same level of satisfaction
B. For each additional quantity of donuts consumed, Donald must give up 1/2 of carrots to
maintain the same level of satisfaction
C. For each additional quantity of carrot consumed, Donald must give up 1/2 of donuts to maintain
the same level of satisfaction
D. For each additional quantity of carrot consumed, Donald must give up 1/9 of donuts to maintain
the same level of satisfaction
E. For each additional quantity of donuts constumed. Donald must give up 1/2 of carrots to
maintain the same level of satisfaction.
F. For each additional quantty of carrots consumed. Donald must give up 9 units of donuts to
maintain the same levelof satisfaction
G. For each additional quantity of donuts consumed, Donald must give up 1/9 of carrots to
maintain the same level of satisfaction
H. For each additional quantity of donuts consumed. Donald must give up 9 units of carrots to
maintain the same level of satisfaction
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