In the diagram below, if legislation allows Angela to be at point F, if Angela and Bruno can bargain costlessly: Angela's reservation indifference curve, IC, Angela's best feasible 12 indifference curve when an independent farmer, CO 8 CA D F FF: Angela and Bruno combined 16 24 Angela's hours of free time Select TWO correct answers. Select one or more: а. Point F is on Angela's indifference curve so it is also Pareto efficient from her point of view. b. The final outcome could be at point H, which is a Pareto improvement. С. Movements along the contract curve between C and D can still bring Pareto improvements for either Angela or Bruno. Bushels of grain

In the diagram below, if legislation allows Angela to be at point F, if Angela and Bruno can bargain costlessly: Angela's reservation indifference curve, IC, Angela's best feasible 12 indifference curve when an independent farmer, CO 8 CA D F FF: Angela and Bruno combined 16 24 Angela's hours of free time Select TWO correct answers. Select one or more: а. Point F is on Angela's indifference curve so it is also Pareto efficient from her point of view. b. The final outcome could be at point H, which is a Pareto improvement. С. Movements along the contract curve between C and D can still bring Pareto improvements for either Angela or Bruno. Bushels of grain

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter18: Asymmetric Information

Section: Chapter Questions

Problem 18.7P

See similar textbooks

Similar questions

Please no written by hand Suppose all workers have the same preferences represented by U = (sqroot)w - 2x , where w is the wage and x is the proportion of the firm’s air that is composed of toxic pollutants. There are only two types of jobs in the economy, a clean job (x = 0) and a dirty job (x = 1). Let w0 be the wage paid by the clean job and w1 be the wage paid for doing the dirty job. If the clean job pays $16 per hour, what is the wage in dirty jobs? What is the compensating wage differential?
Heterogeneity in an endowment economy Suppose we have two typesof households: A and B. The utility maximization problem for a consumerof type i is max InCi,t+β ln Ci,t+1 Ct,Ct+1subject to Ci,t +Ci,t+1/ 1 + rt = Yi,t + Yi,t+1 / 1 + rt Note that the A and B households have the same discount rate and the same utility function. The only thing that is possibly different is their endowments. 1, Write down the Euler equation for households A and B.
Suppose all workers have the same preferences represented byU = √w - 2xwhere w is the wage and x is the proportion of the firm’s air that is composed of toxic pollutants. There are only two types of jobs in the economy: a clean job ( x = 0) and a dirty job ( x =1). Let w0 be the wage paid by the clean job and w1 be the wage paid for doing the dirty job. If the clean job pays $16 per hour, what is the wage in dirty jobs?What is the compensating wage differential?
In the United States, one of the largest welfare programs is the Supplemental NutritionAssistance Program (SNAP)1representing the second largest in-kind transfer programfor individuals in the US. From the abstract of the study we are told “[a] 1% increasein benefits per population raises grocery prices by a persistent 0.08%. A calibratedpartial-equilibrium model implies a marginal benefit dollar raises a recipient’s consumersurplus from groceries by $0.7, producer surplus by $0.5, and lowers each non-SNAPconsumer’s surplus by $0.05.” In other words, increasing the size of the in-kind transferleads to higher prices. This higher price results in a larger surplus for grocery stores anda lower consumer surplus for individuals not participating in SNAP. Those individualswho participate in SNAP can increase their overall consumer surplus as they haveaccess to more goods, despite the higher price. This result is estimated using thenearly 100% redemption of the SNAP benefits (i.e. assuming the…
What are four responses to the claim that people should not behave in the way described in this chapter?
15 A libertarian paternalist would prefer to implement policies that a.adjust the incentives of a decision. b.allow individuals to opt-out of the default option. c.require individuals to make a decision. d.randomly assign individuals to an option if they don't make a choice
In the United States, one of the largest welfare programs is the Supplemental NutritionAssistance Program (SNAP) representing the second largest in-kind transfer programfor individuals in the US. From the abstract of the study we are told “[a] 1% increasein benefits per population raises grocery prices by a persistent 0.08%. A calibratedpartial-equilibrium model implies a marginal benefit dollar raises a recipient’s consumersurplus from groceries by $0.7, producer surplus by $0.5, and lowers each non-SNAPconsumer’s surplus by $0.05.” In other words, increasing the size of the in-kind transferleads to higher prices. This higher price results in a larger surplus for grocery stores anda lower consumer surplus for individuals not participating in SNAP. Those individualswho participate in SNAP can increase their overall consumer surplus as they haveaccess to more goods, despite the higher price. This result is estimated using thenearly 100% redemption of the SNAP benefits (i.e. assuming the…
Willa and Lora are playing the dictator game. Let ww and wL be the amount of money Willa and Lora receive in the game, respectively. Willa plays the role of the dictator and must decide how to split $10. Suppose Willa’s preferences are given by U(ww,wL)=ww (second letters are subscripts). How much will Willa keep and how much will she give to Lora? Explain your answer in one or two sentences. Suppose instead that Willa’s preferences are given by U(ww,wL)=min(ww,wL). (second letters are subscripts) . How much will Willa keep and how much will she give to Lora? Explain your answer in one or two sentences.
Can Entreprenuership be thougth?
Suppose you’re trying to get your friends to go todinner with you. Would it be wiser to frame thedecision as costing only $5 more than the foodthey’d make for themselves, or that it will cost$5 less than every other restaurant around town?
What is fisher'sconcept explain it in moths.?
11. In 2022, Ibram X. Kendi, author of “How to be an Antiracist” informed Valencia College that he would join your economics professor in a moderated discussion – for one hour – and for a fee of $30,000. Who would argue that such a price is not only appropriate, but, if agreed to, would have created benefits for both parties in the transaction? a. John Locke b. Adam Smith c. Ibram X. Kendi d. The author of “I, Pencil” e. All the above.