Question: Q.30 Suppose a representative consumer derives his utility from consumption c and leisure L is given by the function u(L, c) = In(L) + c.

Q.30 Suppose a representative consumer derives his utility from consumption c

Q.30 Suppose a representative consumer derives his utility from consumption c and leisure L is given by the function u(L, c) = In(L) + c. Assume that the unit price of stuff (consumption) equals 1 and that the maximum amount of time available to him is T = 24 hours per day. All his income comes from his work. If the wage rate is w = Rs. 10 an hour, what is his optional choice? Note: Only one option is correct! Max. score: 2; Neg. score: 0.5 L = 1/10, c = 239 L = 1/10, c = 245 L = 1/10, c = 210 L = 1/20, c = 239

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