Author Question: Only individuals A and B live on a desert island where no production is possible. A is endowed with ... (Read 592 times)

Engineer

  • Hero Member
  • *****
  • Posts: 527
Only individuals A and B live on a desert island where no production is possible. A is endowed with 12 units of good X and 18 units of good Y. B is endowed with 6 units of good X and 42 units of good Y. In the Edgeworth box, good X is measured on the horizontal axis. Individual A's utility function is so her MUX = 3Y and her MUY = 3X. Individual B's utility function is UB = 10 so his and his MUY = 5. Which of the following allocations are on the contract curve?
◦ (XA = 9, YA = 30), (XB = 9, YB = 30)
◦ (XA = 10, YA = 28), (XB = 8, YB = 32)
◦ (XA = 12, YA = 24), (XB = 6, YB = 36)
◦ None of the above.


Chou

  • Sr. Member
  • ****
  • Posts: 335

Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question

Chou

  • Sr. Member
  • ****
  • Posts: 335

cookcarl

  • Hero Member
  • *****
  • Posts: 539
Only individuals A and B live on a desert island where no production is possible. A is endowed with 15 units of good X and 17 units of good Y. B is endowed with 13 units of good X and 23 units of good Y. In the Edgeworth box, good X is measured on the horizontal axis. Individual A's utility function is and her MUY = 3X. Individual B's utility function is UB = 10 so his and his MUY = 5. Which of the following allocations are on the contract curve?
◦ (XA = 15, YA = 17), (XB = 13, YB = 23)
◦ (XA = 14, YA = 20), (XB = 14, YB = 20)
◦ (XA = 18, YA = 22), (XB = 10, YB = 18)
◦ None of the above.



ladyjames123

  • Sr. Member
  • ****
  • Posts: 346

 

Did you know?

A strange skin disease referred to as Morgellons has occurred in the southern United States and in California. Symptoms include slowly healing sores, joint pain, persistent fatigue, and a sensation of things crawling through the skin. Another symptom is strange-looking, threadlike extrusions coming out of the skin.

Did you know?

Colchicine is a highly poisonous alkaloid originally extracted from a type of saffron plant that is used mainly to treat gout.

Did you know?

People about to have surgery must tell their health care providers about all supplements they take.

Did you know?

When blood is deoxygenated and flowing back to the heart through the veins, it is dark reddish-blue in color. Blood in the arteries that is oxygenated and flowing out to the body is bright red. Whereas arterial blood comes out in spurts, venous blood flows.

Did you know?

Most childhood vaccines are 90–99% effective in preventing disease. Side effects are rarely serious.

For a complete list of videos, visit our video library