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Yoram's Utility Function Is U(x, Y)= 2x + 5y

Question 1

Multiple Choice

Yoram's utility function is U(x, y) = 2x + 5y.The price of x is $4 and the price of y is $15.Yoram has $150 a week to spend on x and y.Yoram is offered a chance to join a club of y consumers.If he joins, he can get y at a price of $10.What is the most that Yoram would be willing to pay to join the club?


A) Nothing
B) $30 a week
C) $50 a week
D) $75 a week
E) None of the above.

Correct Answer:

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