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Q. Q1. Consider two persons (Ann and Bill) and two-goods(X and Y) exchange economy. The total endowment of the economy is given by X=200 and Y=100. Assume Ann has an initial allocation of 100 units of X and 50 units of Y. She regards X and Y as perfect 1-for-1 complements, always wanting to consume 1 unit of X for every unit of Y. Illustrate diagrammatically the set of allocations that are Pareto preferred to the initial allocation.
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