Multiple Choice
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 a nonlabor income of 32 dollars per day and a wage rate of 13 dollars per hour, he will choose a combination of labor and leisure that allows him to spend
A) 133 dollars per day on consumption.
B) 149 dollars per day on consumption.
C) 266 dollars per day on consumption.
D) 123 dollars per day on consumption.
E) 199.50 dollars per day on consumption.
Correct Answer:
Verified
Correct Answer:
Verified
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