Boudica (B) and Arthur (A) are both homo economicus engaging in exchange. Boudica’s utility function is...
Boudica (B) and Arthur (A) are both homo economicus engaging in exchange. Boudica’s utility function is given by uB = 1/2 lnxB + 1/2 lnyB. Arthur’s utility function is given by uA = 1/2 lnxA + 1/2 lnyA. They are working out an exchange of archers (x) and knights (y) for the defense of their respective realms. Boudica currently has 40 archers and 40 knights. Arthur has 20 archers and 60 knights.
True or False & Explain: Boudica and Arthur’s initial allocations are not Pareto efficient.
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Boudica (B) and Arthur (A) are both homo economicus engaging in
exchange. Boudica’s utility function is...
Section 1-Short questions 1. Arthur and Boudica are both Homo Economicus. Arthur has 20 archers ()...
Section 1-Short questions 1. Arthur and Boudica are both Homo Economicus. Arthur has 20 archers () and 60 knights (A), and Boudica has 40 archers (r) and 40 knights OVB). Arthur's utility function: U.--In(r.) +-In Boudica's utility function: UBIn()+ nB Evaluate the following statement True, or False; and explain: "Arthur and Boudica's initial allocations (endowments) are not Pareto Efficient" I5 points] 2. Use the same utility functions and initial endowment as the previous question for Arthur and Boudica. Boudica -because...
2) This guestion is from Final 2016. Consider an Exchange economx composed of twO individuals A...
2) This guestion is from Final 2016. Consider an Exchange economx composed of twO individuals A and B and two goods x1 and x2. Individual A has an endowment of WA-(3,5) and individual B has an endowment of Ws- (3,3). A's utility function is given by UA- Xx2 a. (3 points) Show that no matter what utility function B has, there exists a Pareto Efficient (PE) allocation. (i.e. Speciỵa Pareto efficient allocation and explain why it is efficient nomatter what...
Consider a pure exchange economy with two consumers and two goods. Total endowments of the two...
Consider a pure exchange economy with two consumers and two goods. Total endowments of the two goods are given by X̅=10 and Y̅=20. Consumer A’s utility function is given by UA(XA,YA)=sqrtXAYA.. Consumer B regards the two goods as perfect substitutes with MRS=2. (1) Find the contract curve for this economy. (2) Suppose the initial endowments are given as the following: 2,8), (XA, YA)=(2,8) (XB,YB)=(8,12). Find the set of Pareto efficient allocations that Pareto dominate the endowment poin
Consider an exchange economy consisting of two people, A and B, endowed with two goods, 1...
Consider an exchange economy consisting of two people, A and B, endowed with two goods, 1 and 2. Person A is initially endowed with wA(4,8) and person B is initially endowed with w(4,0). Their preferences are given by UA(ri,r2)1 and UB(xi, r2) (a) Write the equation of the contract curve (express as a function of ) (b) Let P2 Find the cornpetitive equilibrium price, pi, and allocations, xA -(zl,r1) and B-B (c) Now suppose that person B's preferences are instead...
can u answer the 2nd question please？ utility function Let us introduce a second person, who...
can u answer the 2nd question please？
utility function
Let us introduce a second person, who has standard Cobb-Douglas utility UB = (x+B)•(x²B). Their endowments are wa= (6, 3) and WB = (3,6). You may assume p2 = 3p1. Find the amount person A consumes of good 1 in competitive equilibrium. Simplify decimals (no extra zeros). Find the contract curve (the set of all Pareto efficient points) for the setting in question 3. et ua = x+A+ 3x?
2. (20 points) Suppose there are two consumers, A and B The utility functions of each consumer are given by: UA(X,Y...
2. (20 points) Suppose there are two consumers, A and B The utility functions of each consumer are given by: UA(X,Y) XY UB(X,Y) Min(X,Y) The initial endowments are: A: X 1; Y 1 B: X 5; Y 5 Illustrate the initial endowments in and Edgeworth Box. Be sure to label the Edgeworth Box carefully and accurately, and make sure the dimensions of the box are correct. Also, draw each consumer's indifference curve that runs through the initial endowments. Is this...
Anything will help Consider a pure exchange economy with two goods, wine (x) and cheese (y)...
Anything will help
Consider a pure exchange economy with two goods, wine (x) and cheese (y) and two con- sumers, A and B. Let cheese be the numeraire good with price of $1. Consumer A's utility function is UA(x, y) = xy and B's utility function is UB(x, y) = min [x, y). A has an initial allocation of 10 x and no y, and B has an initial allocation of 10 units of y and no x. (a) Put...
Suppose individuals A and B start with endowments (3,7) and (7,3),respectively. *Please answer all parts of...
Suppose individuals A and B start with endowments (3,7) and (7,3),respectively. *Please answer all parts of the question including #5,6,7,8,9,10,11* Draw the Edgeworth box and label the initial endowments. Are the final allocations (6, 3) and (5, 6) feasible? Suppose that individual A has utility function UA = xA1 + 2xA2 . Draw a few of A’s indifference curves on the Edgeworth box. (Make sure you’ve drawn them correctly.) Suppose that individual B has utility function UB = 2xB1 +...
Use the following information for Q4 and 25. There are two consumers A and B with...
Use the following information for Q4 and 25. There are two consumers A and B with the following utility functions and endowments: UA (XA, YA) = x A +aya, (W2A, WyA) = (1,2) UB(XB, YB) = {b + yb, wzB, WyB) = (2, 1) where a>1, X; and Yi denote the consumption of goods x and y for consumer i, and (Wri, Wyi) denote the endowment of goods x and y for consumer i. Q4: True or false. At any...
this is the entire question this is all the information given 2. Consider a pure exchange...
this is the entire question
this is all the information given
2. Consider a pure exchange economy with two goods, wine (x) and cheese (y) and two con- sumers, A and B. Let cheese be the numeraire good with price of $1. Consumer A's utility function is UA(x, y) = 2.c + y and B's utility function is UB(x, y) = xy. A's initial allocation is 10 units of c and 0 units of y. B's initial allocation is 0...
Section 1-Short questions 1. Arthur and Boudica are both Homo Economicus. Arthur has 20 archers () and 60 knights (A), and Boudica has 40 archers (r) and 40 knights OVB). Arthur's utility function: U.--In(r.) +-In Boudica's utility function: UBIn()+ nB Evaluate the following statement True, or False; and explain: "Arthur and Boudica's initial allocations (endowments) are not Pareto Efficient" I5 points] 2. Use the same utility functions and initial endowment as the previous question for Arthur and Boudica. Boudica -because...
2) This guestion is from Final 2016. Consider an Exchange economx composed of twO individuals A and B and two goods x1 and x2. Individual A has an endowment of WA-(3,5) and individual B has an endowment of Ws- (3,3). A's utility function is given by UA- Xx2 a. (3 points) Show that no matter what utility function B has, there exists a Pareto Efficient (PE) allocation. (i.e. Speciỵa Pareto efficient allocation and explain why it is efficient nomatter what...
Consider an exchange economy consisting of two people, A and B, endowed with two goods, 1 and 2. Person A is initially endowed with wA(4,8) and person B is initially endowed with w(4,0). Their preferences are given by UA(ri,r2)1 and UB(xi, r2) (a) Write the equation of the contract curve (express as a function of ) (b) Let P2 Find the cornpetitive equilibrium price, pi, and allocations, xA -(zl,r1) and B-B (c) Now suppose that person B's preferences are instead...
can u answer the 2nd question please？
utility function
Let us introduce a second person, who has standard Cobb-Douglas utility UB = (x+B)•(x²B). Their endowments are wa= (6, 3) and WB = (3,6). You may assume p2 = 3p1. Find the amount person A consumes of good 1 in competitive equilibrium. Simplify decimals (no extra zeros). Find the contract curve (the set of all Pareto efficient points) for the setting in question 3. et ua = x+A+ 3x?
2. (20 points) Suppose there are two consumers, A and B The utility functions of each consumer are given by: UA(X,Y) XY UB(X,Y) Min(X,Y) The initial endowments are: A: X 1; Y 1 B: X 5; Y 5 Illustrate the initial endowments in and Edgeworth Box. Be sure to label the Edgeworth Box carefully and accurately, and make sure the dimensions of the box are correct. Also, draw each consumer's indifference curve that runs through the initial endowments. Is this...
Anything will help
Consider a pure exchange economy with two goods, wine (x) and cheese (y) and two con- sumers, A and B. Let cheese be the numeraire good with price of $1. Consumer A's utility function is UA(x, y) = xy and B's utility function is UB(x, y) = min [x, y). A has an initial allocation of 10 x and no y, and B has an initial allocation of 10 units of y and no x. (a) Put...
Use the following information for Q4 and 25. There are two consumers A and B with the following utility functions and endowments: UA (XA, YA) = x A +aya, (W2A, WyA) = (1,2) UB(XB, YB) = {b + yb, wzB, WyB) = (2, 1) where a>1, X; and Yi denote the consumption of goods x and y for consumer i, and (Wri, Wyi) denote the endowment of goods x and y for consumer i. Q4: True or false. At any...
this is the entire question
this is all the information given
2. Consider a pure exchange economy with two goods, wine (x) and cheese (y) and two con- sumers, A and B. Let cheese be the numeraire good with price of $1. Consumer A's utility function is UA(x, y) = 2.c + y and B's utility function is UB(x, y) = xy. A's initial allocation is 10 units of c and 0 units of y. B's initial allocation is 0...
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