Yes, all point on the contract curve are the core points
since (10,10) lie on the contract curve because none of them can be made better off without worsening others. Thus (10,10) lies on the contract curve and is one of the core
A and B have identical preferences u(x, y) = min{x,y). A's endowment is (1,9) and B's...
A has preferences U(x,y)=x+y and endowment (3,3). B has preferences U(x,y)=y (no typo) and endowment (7,7). What is px/py? Enter a number only, round to two decimals.
Two agents have identical quasilinear preferences U(x, y)-u(x) + y, where , x , x E [0,1] Agent 1's endowment is (3/2, 1/2) and agent 2's endowment is (1/2, 3/2). Normalize so that the price of good 2 is A) Calculate a Walrasian equilibrium at which the price of good 1 is greater than 1/2. Are there other Walrasian equilibria? B) Suppose agent 1's endowment were (2, 1/2). Find a Walrasian equilibrium for this economy. Note that agent is actually...
Can
anyone help me with this one?
Two agents have identical quasilinear preferences U(x, y)-u(x) +y, where u(x) =|x-1 + 1 , x > 1 Agent I's endowment is (3/2, 1/2) and agent 2's endowment is (1/2, 3/2). Normalize so that the price of good 2 is 1. There is a Walrasian Equilibrium at which the price of good 1 is greater than 1/2. Draw an Edgeworth Box for this economy. Draw and label the following elements: (I) The Walrasian...
Need help with Edgeworth Box exercise
Two agents have identical quasilinear preferences U(x, y)-u(x) +y, where u(x) =|x-1 + 1 , x > 1 Agent I's endowment is (3/2, 1/2) and agent 2's endowment is (1/2, 3/2). Normalize so that the price of good 2 is 1. There is a Walrasian Equilibrium at which the price of good 1 is greater than 1/2. Draw an Edgeworth Box for this economy. Draw and label the following elements: (I) The Walrasian Equilibrium...
There are three consumers A, B and C. A's utility function is u^ = x; xz, B's utility function is u = 3xx, and C's utility function is u = ln x; + ln x, -100. Your friend argues that A, B and C have an identical Marshall demand function for good 1. Do you agree with this argument? Give the reason for your answer.
Assume: goods x, y; consumers A, M; total endowment of good x equals that of y, A's preference: U-min(x,y), M's preference: U=max(x,y] In an Edgeworth Box the set of Pareto-efficient allocations will consist of a. Two diagonals. b. One of the diagonals. c. The entire diagram (box) d. The diagonals and the outer borders of the diagram (box). e. The outer borders of the diagram (box)
Consumer A has a utility function u(x,y) = xA + yA and an endowment of (x,y) = (25,5). Consumer B has a utility function u(x,y) = min{xB,yB} and an endowment (x,y) = (25,45). a. Carefully sketch the Edgeworth Box and indicate where the endowment is. b. What is A’s utility and B’s utility if they each simply consumer their endowments? c. Next, add the indifference curve for A and B, through their endowments in your Edgeworth Box. d. Find a...
Maria has a utilty function u(x,y) = min{ 2x, 0.5y} and a labor endowment of 120 units. The production functions are x = 4Lx and y = 12Ly. In this case, what is the optimal labor that should be allocated to producing good x? 51.4 54.5 56.5 62.3
2. Consider a utility function that represents preferences: u(x,y)= min{80x,40y} Find the optimal values of x and y as a function of the prices px and py with an income level m. (5)
3. Sam's preferences are represented by the following utility function: U(x, y)-min(4x, 2y a. Are any of the two goods in his utility function "essential"? b. Draw Sam's indifference curve for utility of 8 and utility of 16