Jane has 11 liters of soft drinks and 10 sandwiches. Bob, on the other hand, has 9 liters of soft drinks and 10 sandwiches. With these endowments, Jane's marginal rate of substitution (MRS) of soft drinks for sandwiches is 6 and Bob's MRS is equal to 8. Draw an Edgeworth box diagram to show whether this allocation of resources is efficient. If it is explain why. If it is not, what changes will make both parties better off? Part 2 1.) Using the three-point curved line drawing tool, draw an indifference curve for Jane when consuming 11 liters of soft drinks and 10 sandwiches. Label this curve UJ. 2.) Using the three-point curved line drawing tool, draw an indifference curve for Bob when consuming 9 liters of soft drinks and 10 sandwiches. Label this curve UB.
Jane has 11 liters of soft drinks and 10 sandwiches. Bob, on the other hand, has 9 liters of soft drinks and 10 sandwiches. With these endowments, Jane's marginal rate of substitution (MRS) of soft drinks for sandwiches is 6 and Bob's MRS is equal to 8.
Draw an Edgeworth box diagram to show whether this allocation of resources is efficient. If it is explain why. If it is not, what changes will make both parties better off?
Part 2
1.) Using the three-point curved line drawing tool, draw an indifference curve for Jane when consuming 11 liters of soft drinks and 10 sandwiches. Label this curve UJ.
2.) Using the three-point curved line drawing tool, draw an indifference curve for Bob when consuming 9 liters of soft drinks and 10 sandwiches. Label this curve UB.
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