Mr Cog Has 18 Hours Per Day to Divide Between

Mr. Cog has 18 hours per day to divide between labor and leisure. His utility function is U(C, R) = CR, where C is dollars per year spent on consumption and R is hours of leisure. If he has 5 dollars of nonlabor income per day and gets a wage rate of 11 dollars per hour when he works, his budget equation, expressing combinations of consumption and leisure that he can afford to have, can be written as

A) C = 203 + 11R.
B) R += 269.
C) 11R + C = 5.
D) 11R + C = 203.
E) C = 218 + 11R.

Correct Answer:

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