Question
A Capuchin monkey's preference over cF units of fruit discs and cC units of cereal chunks can be represented by the utility function u (cF
A Capuchin monkey's preference over cF units of fruit discs and cC units of cereal chunks can be represented by the utility function u (cF , cC ) = cF + cC + (cF rF ) + (cC rC ) where rF is his reference point for fruit discs, and rC is his reference point for cereal chunks. The function () is defined as (z) = ( z z 0 3z z < 0 . Suppose that the monkey has nothing and is asked to choose between receiving fruit discs or receiving cereal chunks. What is the minimum number of cereal chunks the monkey would be willing to accept instead of receiving one fruit disc?
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