Question: Joanne's utility function is given by Uj = Xa + 2Xb where Xa denotes her consumption of apples and Xb her consumption of bananas. Colleen's
Joanne's utility function is given by Uj = Xa + 2Xb where Xa denotes her consumption of apples and Xb her consumption of bananas.
Colleen's utility function is given by Uc = 3Xa + 2Xb , where Xa denotes her consumption of apples and Xb her consumption of bananas.
Joanne and Colleen shop at the same grocery store.
- When we observe that Joanne leaves the store with some bananas, then we can deduce that Colleen also buys some bananas.
- There exist prices of apples and bananas such that both consumers buy strictly positive amounts of both goods.
- When we observe that Joanne leaves the store with some apples and some bananas, then we can deduce that Colleen also buys some apples and some bananas.
- When we observe that Joanne leaves the store with some apples, then we can deduce that Colleen also buys some apples.
- Apples and bananas are perfect complements for Joanne.
Which is correct, please show all steps.
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