Author Question: Only individuals A and B live on a desert island where no production is possible. A is endowed with ... (Read 615 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?

Children of people with alcoholism are more inclined to drink alcohol or use hard drugs. In fact, they are 400 times more likely to use hard drugs than those who do not have a family history of alcohol addiction.

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?

Everyone has one nostril that is larger than the other.

Did you know?

Many of the drugs used by neuroscientists are derived from toxic plants and venomous animals (such as snakes, spiders, snails, and puffer fish).

Did you know?

The ratio of hydrogen atoms to oxygen in water (H2O) is 2:1.

For a complete list of videos, visit our video library