where x is whips and y is leather jackets, if Kinko's utility function were U(x, y)  min7x, 3x  12y, then if the price of whips were $20 and the price of leather jackets were $60, Kinko would demand

A) 4 times as many leather jackets as whips.
B) 3 times as many whips as leather jackets.
C) 5 times as many whips as leather jackets.
D) 2 times as many leather jackets as whips.
E) only leather jackets.

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Cailee Scudiero · Accepted Answer

Final Answer : B, Explanation :  Kinko's utility function is based on the minimum of {7x, 3x + 12y}. For Kinko to maximize utility, the two expressions inside the min{} function should be equal, i.e., 7x = 3x + 12y. Solving for y in terms of x gives y = (7x - 3x)/12 = x/3, indicating Kinko would demand 3 times as many whips as leather jackets.

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