Consider a society consisting of just a farmer and a tailor. The farmer has 10 units of food but no clothing. The tailor has 20 units of clothing but no food. Suppose each has the utility function U = F x C. The price of clothing is always $1. Suppose the current price of food is $3. The price of food that clears both markets is; %3D O $0.5 O$1 O $2 O$2.5 O$ 4 Show your work

Consider a society consisting of just a farmer and a tailor. The farmer has 10 units of food but no clothing. The tailor has 20 units of clothing but no food. Suppose each has the utility function U = F x C. The price of clothing is always $1. Suppose the current price of food is $3. The price of food that clears both markets is; %3D O $0.5 O$1 O $2 O$2.5 O$ 4 Show your work

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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