Consider two individuals  M and F who must split 20 units of good X and 10 units of good Y. Suppose we can represent M's preference with the utility function Um =X^2mYm and Fs preference with the utility Uf = min{Xf, 2Yf} Where Xm and Xf indicate their X consumption, while Ym and Yf indicate their Y consumption a) Derive the MRS for M b) Interpret F's utility function c) Find and graph the contract curve d) What is the ratio of the price of X to the Price of Y in competitive equilibrium? e) To which allocation will M and F trade? Indicate this outcome clearly in your graph Posted Date: 2/25/2013 2:02:57 AM | Location : United States

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