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Charlie's Utility Function Is U(xA, XB) = XAxB

Question 47

Multiple Choice

Charlie's utility function is U(xA, xB) = xAxB. If Charlie's income is $40, the price of apples is $4, and the price of bananas is $2, how many apples are there in the best bundle that Charlie can afford?


A) 10
B) 8
C) 12
D) 9
E) 5

Correct Answer:

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