A consumer's indirect utility function is given $v(x \mid 0)=\left\{\begin{array}{c}u_{g}=\ln (x) \text { if } x \geq 0 \ u_{l}=x \text { if } x \leq 0\end{array}\right.$
The individual wins $\$ 500$ dollars at the casino, but gets a speeding ticket that requires him to pay $\$ 75$ on his drive home. Is he better off by integrating or segregating these two transactions?

Question

Quizplus · Accepted Answer

The Answer of A consumer's indirect utility function is given $v(x \mid 0)=\left\{\begin{array}{c}u_{g}=\ln (x) \text { if } x \geq 0 \ u_{l}=x \text { if } x \leq 0\end{array}\right.$
The individual wins $\$ 500$ dollars at the casino, but gets a speeding ticket that requires him to pay $\$ 75$ on his drive home. Is he better off by integrating or segregating these two transactions?

A Consumer's Indirect Utility Function Is Given v(x∣0)={ug=ln⁡(x) if x≥0ul=x if x≤0v(x \mid 0)=\left\{\begin{array}{c}u_{g}=\ln (x) \text { if } x \geq 0 \\ u_{l}=x \text { if } x \leq 0\end{array}\right.v(x∣0)={ug​=ln(x) if x≥0ul​=x if x≤0​

A Consumer's Indirect Utility Function Is Given $v(x \mid 0)=\left\{\begin{array}{c}u_{g}=\ln (x) \text { if } x \geq 0 \\ u_{l}=x \text { if } x \leq 0\end{array}\right.$