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Question 2: 8 marks (1, 1, 1, 2, 3) Deborah's utility over consumption (C), hours worked (H), and hours spent in commute (S) is: (1)
Question 2: 8 marks (1, 1, 1, 2, 3) Deborah's utility over consumption (C), hours worked (H), and hours spent in commute (S) is: (1) U(C,H)=C\"2HS. The maximum number of hours that Deborah can work productively is 10. Thus (2) O s H s 10. On the days which Deborah works, she spends 2 hours in commuting from home to work and then back (one hour each way). (3) |fH>0,S=2.E|seifH=0,S=0. Assume that C 2 0 and S 2 0. For simplicity, we also assume that there are no other costs (e.g., ticket costs, parking fee) associated with commuting. (a) (1 mark) Explain why Deborah's preferences are not strongly monotone in C and H. Use an example to support your answer. (b) (1 mark) Deborah's marginal utility from consumption (C) is strictly decreasing in C. True or False? Explain
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