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Lorenzo lives on X and Y only. His utility function is U (X,Y) = min(3X+4Y; 7Y). The prices of both goods are positive. He will:
"Lorenzo lives on X and Y only. His utility function is U (X,Y) = min(3X+4Y; 7Y). The prices of both goods are positive. He will:
a. Never buy more X than Y;
b. Always buy equal amounts of the two goods;
c. Always buy more Y than X;
d. Always buy more X than Y;
e. More than one of the above is true."
The right choice is a. But why not b? Thank you
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