Professor Coughlin
Econ 306

Homework 5

I. Questions 1 & 2 are true/false, 3 & 4 are multiple choice (1 point each)
II. Please complete the homework 5 problems on the Aplia Website.  (2 points each)

1. If Sheetal has a utility function U=2min{x,y} then x and y are perfect complements for that person
a)True
b)False

 2. Heather strictly prefers consumption bundle A to consumption bundle B and weakly prefers bundle B to bundle A. These preferences can be represented by a utility function.
a)True
b)False

 3. Charlie's utility function is U(A,B)=AB where A and B are the numbers of apples and bananas, respectively, that he consumes. When Charlie is consuming 20 apples and 40 bananas, if we put apples on the horizontal axis and bananas on the vertical axis, the slope of his indifference curve at his current consumption is:
a) -20
b) -2
c) -4
d) -1/2
e) -1/4

 4. Aishwarya has preferences represented by the utility function U(x,y) = 20x+5y. She consumes 20 units of good x and 4 units of good y. If her consumption of good x is lowered to 13, how many units of y must she have in order to be exactly as well off as before?
a) 37 units of good y
b) 22 units of good y
c) 32 units of good y
d) 4 units of good y
e) None of the above