Question

UA = ?^1/2?^1/4 and (??x, ??y) = (90,30) UB = ?1/2?^1/4 and (??x, ??y) = (10,50)...

UA = ?^1/2?^1/4 and (??x, ??y) = (90,30)

UB = ?1/2?^1/4 and (??x, ??y) = (10,50)

For each of the above economies

  1. a) Derive the contract curve.

  2. b) Find the competitive equilibrium price ratio and allocation.

  3. c) Use an Edgeworth box to illustrate the competitive equilibrium

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Answer #1

C) box dimensions : 100×80

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