Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Suppose that there are two consumers in an exchange economy with two goods. There are total of ten units of each good. The initial endowments for these consumers are (e1x, e1y) for consumer 1 and (e2x, e2y) for consumer 2, where e2x = 10 – e1x and e2y = 10 – e1y. Consumer 1 has utility function u(x1, y1) = x1 1/3 y1 2/3, while consumer 2 has utility function v(y1, y2) = x2 2/3 y2 1/3. (a) Normalize the price of good 1 to 1 and denote the price of good 2 by p. Write the budget constraints for each consumer. (b) Solve for each consumer's optimal consumption bundle as a function of price p. (c) Is each person's consumption of good x increasing or decreasing as a function of p? Explain the meaning of this result in words -- is this the result that you would expect? (d) What is the equilibrium price for the initial allocation of (6, 2) to consumer 1 and (4, 8) to consumer 2? What are the resulting equilibrium bundles? (e) What is the first-order condition for Pareto optimality? Check that the equilibrium bundles satisfy this condition. (f) We know that with Cobb-Douglas preferences of this form, consumer 1 spends 1/3 of her wealth on good 1, while consumer 2 spends 2/3 of her wealth on good 1. So why doesn't the equilibrium allocation leave consumer 1 with twice as much of good 2 as of good 1 - and similarly for consumer 2?
q.a manufacturer of computer workstations gathered average monthly sales figures from its 56 branch offices and
Explicate Illustrate what happens to the interest rates when the Fed makes open market bond purchases.
Explain the concepts of intrinsic value and economic value added for Federal Express and United Postal Service. Discuss financial (e.g., ratios and balance sheets analysis) and non- financial variables at play in valuing the two companies. Explain ho..
A low - cost noncontact temperature measuring tool may be able to identify railroad car wheels that are in need of repair long before costly structural failure occurs. If the BNSF railroad saves 100,000 in year 1, $110,000 in year 2, and amounts incr..
q1. why do proponents of active policy recommend government intervention to close an expansionary gap? briefly
All of the following statements about banks in Zimbabwe in 2009 are true except-Political instability increased the risk of bank failures.
The gross domestic product of countries Babistan, Turma, and Deru are $1,500, $2,500, and $3,500, respectively. There are 1,500 miles between country Babistan and countries Turma, and Deru. Does the gravity equation predict that there will be more tr..
True/False questions: The Durbin-Watson (DW) statistic is used to detect first order-serial correlation. Positive lag 1 residual autocorrelation is associated with DW values greater than 2. Autocorrelation exists when successive observations over tim..
When Betsy goes to make her list for tomorrow she is upset that she didn't get everything done. In a well-written paragraph explain the economics behind her inability.
Using the aggregate demand-aggregate supply diagram, explain the impact of an appreciation of the U.S. dollar on the price level and real income in the short run.
Wally is an ordinary (one-price) monopoly supplier of widgets. True or False: If Wally’s customers could get together and offer him a one-time payment in exchange for being allowed to buy widgets at a competitive price, then both they and he could be..
Based on your own Internet research, track the changes in the Euro/USD exchange rate since the Euro was launched in 2002. Which currency has appreciated and which has depreciated over the past 13 years? Provide two reasons why this has occurred.
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd