Which of the following utility functions is an example of preferences for perfect substitutes?

Question

Quizplus · Accepted Answer

The utility function in choice C is U(x,y) = min {ax,by}. This function indicates that the consumer has perfect substitutes for x and y, since the utility derived from each good is determined solely by the quantity of that good consumed. For example, if a=1 and b=2, then the consumer derives the same level of utility from consuming 2 units of x and 1 unit of y, as from consuming 1 unit of x and 2 units of y. Thus, the answer is C.

Which of the Following Utility Functions Is an Example of Preferences