Derive an equilibrium using given information

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Question: Consider an economy with two individuals and two goods. Preferences are Leontief and in particular, u1(x, y) = min{2x, y} and u2(x, y) = min{x, 2y} Initial endowments are ?1 = (4, 0) and ?2 = (0, 4)

(a) Derive an equilibrium

(b) Now suppose the initial endowment of 1 changed to ? 0 1 = (4, e) Is 1 better off by the change?

(c) What if the initial endowment of 1 is ? 00 1 = (4 + e, e)

Reference no: EM132141932

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