User Account

All Pages

Compute the equilibrium for the two islands

Assignment Help Mechanical Engineering
Reference no: EM13887957

Robinson Crusoe and Friday live on separate islands and produce two goods, cloth yC and food yF using two factors of production, land (T ) and labor (L). The utility functions of both Crusoe and Friday are

u(yF, yC) = yFyC.

The production function for cloth is

yC = 4L1/4T 3/4.

The production function for food is

yF = rL3/4T 1/4.

Crusoe is endowed with two units of labor and one of land. Friday is endowed with one unit of labor and two of land.

(a) Suppose there is no trade between the islands. Compute separate equilibria for Crusoe and Friday, letting the labor of each be the unit of account on his own island.

(b) Suppose there is free trade between the islands in cloth and food but no trade in labor and land. Compute the equilibrium for the two islands together with the labor of Crusoe as the unit of account. (Hint: Use the symmetry of the problem.)

Reference no: EM13887957

Questions Cloud

How is the predetermined overhead rate determined : How is the predetermined overhead rate determined when standard costs are used? What is the difference between a favorable cost variance and an unfavorable cost variance?
Continuous and strictly quasi-concave : Consider an Edgeworth box economy with endowments eA = (1, 0) and eB = (0, 1) and utility functions uA(x1,x2) and uB(x1, x2), where uA and uB are continuous and strictly quasi-concave.
Is the resulting tax system advantageous to investment-take : Suppose companies can deduct interest payments on their debt against their taxable income: they pay tax on pro?ts, net of interest payments on debt. The revenue that a com- pany generates from some new investment is taxed, but it can be offset by ..
Analyze the importance of the pre-solicitation notice : The Pre-Solicitation Notice: Analyze the importance of the pre-solicitation notice to the success or failure of the contracting process
Compute the equilibrium for the two islands : Suppose there is free trade between the islands in cloth and food but no trade in labor and land. Compute the equilibrium for the two islands together with the labor of Crusoe as the unit of account. (Hint: Use the symmetry of the problem.)
What are the express and implied agreements : Who are the stakeholders? Who are those people and/or groups to which we owe a duty? What are the express and implied agreements that you have with each of the constituents
What is the annual user cost of a van : A delivery company can buy a new van for $50,000. It can ?nance the purchase with a bank loan. The annual interest rate is 12%. Interest payments are tax deductible and the corporate tax rate is 30%.What is the annual user cost of a van?
Society production possibility frontier : Plot the society's production possibility frontier for food and wood.
Distinguish between an ideal standard and a normal standard : Distinguish between an ideal standard and a normal standard. What factors should be considered in setting (a) the direct materials price standard and (b) the direct materials quantity standard?

Reviews

Write a Review

Mechanical Engineering Questions & Answers

  The cylinder with a friction-less piston of 2-kg mass and a

the cylinder with a friction-less piston of 2-kg mass and a radius of 5 cm initially at 1 liter in volume and is filled

  Show the process on a t-v diagram label axes with respect

one kilogram of ammonia initially saturated vapor at -4degc undergoes a constant volume process to a final pressure of

  The ball is in contact with the racket for 310 if the

a tennis racket hits a tennis ball with a force of where 1130 470 and is the time in milliseconds. the ball is in

  Calculate the final length and the final diameter of this

a cylinder with a 6.0 in diameter and 12.0 in length is put under compression load of 150 kips. the modulus of

  Calculate the work in kjkg done per unit mass of the steam

steam at 2.5 mpa and 400 c enters an adiabatic steam turbine with a low velocity and leaves with a velocity of 180 ms

  Disk has angular velocity omega 01 rads at t 0 and

point a on circuilar disk is at angular position theta 0 at time t 0. disk has angular velocity omega 0.1 rads at t

  Calculate the normal stress in each rod

In our stress calculation example, we had an array of rod diameters and wanted to calculate the normal stress in each rod when it is loaded by an axial load P of 1000 lbs. EDU stresscalc ?

  A hydroponic garden uses the 10 m long perforated pipe

a hydroponic garden uses the 10 m long perforated pipe system to deliver water at 20ordmc. the pipe is 5cm in diameter

  Question 1approximate the torque and power necessary to

question 1approximate the torque and power necessary to rotate the inner 20 cm diameter cylinder shown in figure 1. sae

  What is the diameter need if a safety factor of 1.3 is used

What is the diameter that I need if a safety factor of 1.3 is used -  Take as load only the bending moment caused by the force into account and use the SN diagram below.

  Determine the unknown properties of the perfect gas

Carbon dioxide gas (CO2) at a pressure of 15 psia and 90 degrees F. Determine the unknown properties of the perfect gas (specific volume).

  The second stream has a temperature of 15c relative

two humid airstreams are adiabatically mixed at 1atm pressure to form a third stream. the first stream has a

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd