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General Equilibrium Consider, U1(x1, y1) = 5(x1y1) 3 + 12 U2(x2, y2) = 3lnx2 + 25lny2 + 10 W1 = (7, 3) and W2 = (4, 6) a. Characterize the Pareto efficient allocations and contract curve b. Which allocations are in the core ? c. Find the Competitive/Walrasian equilibrium for this problem . d. Is the allocation found in c in the core? Why?

General Equilibrium Consider, U1(x1, y1) = 5(x1y1) 3 + 12 U2(x2, y2) = 3lnx2 + 25lny2 + 10 W1 = (7, 3) and W2 = (4, 6) a. Characterize the Pareto efficient allocations and contract curve b. Which allocations are in the core ? c. Find the Competitive/Walrasian equilibrium for this problem . d. Is the allocation found in c in the core? Why?

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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General Equilibrium

Consider, U1(x1, y1) = 5(x1y1) 3 + 12 U2(x2, y2) = 3lnx2 + 25lny2 + 10 W1 = (7, 3) and W2 = (4, 6)

a. Characterize the Pareto efficient allocations and contract curve

b. Which allocations are in the core ?

c. Find the Competitive/Walrasian equilibrium for this problem

. d. Is the allocation found in c in the core? Why?

General Equilibrium Consider, U1(T1, Y1) = 5(x1Y1)³ + 12 U2(x2, Y2) = 31nx2 + 25lny2 + 10 W1 = (7, 3) and W2 = (4, 6) a. Characterize the Pareto efficient allocations and contract curve b. Which allocations are in the core c. Find the Competitive/Walrasian equilibrium for this problem d. Is the allocation found in c in the core? Why?
Transcribed Image Text:General Equilibrium Consider, U1(T1, Y1) = 5(x1Y1)³ + 12 U2(x2, Y2) = 31nx2 + 25lny2 + 10 W1 = (7, 3) and W2 = (4, 6) a. Characterize the Pareto efficient allocations and contract curve b. Which allocations are in the core c. Find the Competitive/Walrasian equilibrium for this problem d. Is the allocation found in c in the core? Why?
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