Four individuals (call them 1,2, 3 and 4) have jointly inherited 2 assets (call them A, and B). The utilities are given in the following table. Identify all Pareto efficient ways to distribute these assets amount them. 2 3 4 3 1 A 7 5
Q: Suppose $10 is to be allocated between two people, A and B. Their preferences over A’s income, x4,…
A: The pareto efficiency is the situation when it is not possible to make someone better off without…
Q: 3. Sarah and Jane are two representative individuals living in an economy that produces two goods, X…
A: Since you have posted questions with multiple subparts, we answer the first three for you. If you…
Q: Suppose there are two identical cities, city A and city B. They have the following utility curve: x…
A: Cities in a regional economy are linked through the labor and goods market. In the long run, the…
Q: The following graph depicts three families, X, Y, and Z, and their utility based on spending on…
A: According to the question, the blue line shows the usual graph and the red line shows the budget…
Q: Persons A and B are roommates. Person A smokes and Person B does not. The index s measures how smoky…
A: As per bartleby guidelines i only have to answer only first MCQs Persons A and B are roommates.…
Q: Economics Bluth's preferences for paper and houses can be expressed as Ub(p, h) = 2pb + hb, while…
A: Edgeworth box is a box that shows the market of two goods and two consumers. The sides of the box…
Q: Efficiency means that Select one: a.society is getting the maximum benefits from its scarce…
A: The efficiency is achieved where the resources are fully utilized.
Q: Assume Jim consumes two goods: X and Y. He has a utility function of U=X²Y on bundles of (X, Y). The…
A: A consumer maximizes utility by consuming a bundle where slope of indifference curve, ratio of…
Q: What is a major difference between adaptive and rationalexpectations? Give an example of each.
A: Meaning of Macroeconomics: The term macroeconomics refers to the situation of economic and…
Q: What do you understand by the following terms: - Bounded rationality…
A: Bounded Rationality - Individuals are considered to be rational when making decisions, however,…
Q: We now focus on one country. Assume that the society is composed of two individuals A and B. The…
A: UA = IA UB=0.5IBa) Income distribution when the utility of both the individuals is same UA = UBIA…
Q: Explain the decision-making of economic agents (graphically and mathematically).
A: Economic agents are nothing but the players the impact and get impacted by the economic events .…
Q: Elizabeth Swann and her husband consume wine (W) and books (B). Elizabeth's utility function is…
A: Elizabeth's Utility function : Ue = W Endowment : W , B = ( 16 , 5 ) Husband's Utility function : Uh…
Q: By means of two examples,explain the principle that economic agents take decisions at the margin
A: Thinking at the margin means comparing the opportunity costs and the benefits derived from it.
Q: oints on a utility possibility curve represent a given distribution of well-being between two…
A: Utility refers to the satisfaction a consumer receives as a result of using a service or purchasing…
Q: TRUE OR FALSE Social welfare indifference curves are useful in discussions about the tradeoffs…
A: An indifference bend shows a blend of two products that give a shopper equivalent fulfillment and…
Q: 2. Diana and Jennie are stranded on a desert island. Each has in his possession some slices of ham…
A: An Edgeworth box is a graphical depiction of a market with just two goods, X and Y, and two…
Q: Modified True or False: State whether each statement is true or false. If the statement is false,…
A: The correct answer is given in the second step.
Q: 6.8 (0) Casper consumes cocoa and cheese. He has an income of $16. Cocoa is sold in an unusual way.…
A:
Q: Social efficiency requires that, if Q 1 units are bought and sold in a market, then the ____ of Q 1…
A: Social efficiency is the concept of most optimal distribution of the goods and services (resources)…
Q: Suppose we write the distribution of utilities between two people as (utility of person 1, utility…
A: Economics as a subject deals with the allocation of scarce resources among humans with unlimited…
Q: In Famland, there are two types of individuals: active; sedentary. While the active individuals like…
A: GIVEN In Famland, there are two types of individuals: active; sedentary. While the active…
Q: Using an Edgeworth box, illustrate and explain the concept of Pareto efficiency
A: The above figure represents the Edgeworth box where O1 is the origin of the individual-1 and O2 is…
Q: Describe the model of optimal distribution of Paul and peter with an appropriate graph.
A: ANSWER STEP-1 MODEL OF OPTIMAL DISTRIBUTION :- PAUL & PETER Rationale for Income Distribution…
Q: According to the graph from the previous question, good 1 is and good 2 is normal; normal inferior;…
A: A normal good is one of which the consumer purchases more with an increase in income. An inferior…
Q: There are 500,000 people in Merageville. Each one of them enjoys hikes through the forest at the…
A: Pareto efficiency, also known as Pareto optimality is an economic state where resources cannot be…
Q: In which of the following cases would we expect a person to experlence no net change In their…
A: By the term behavioral economics, economists mean that; generally individuals take the decision that…
Q: “How to allocate limited resources in an efficient way (as emphasized in an introductory economics…
A: Economic resources are scarce or limited. When we talk about scarcity, we must allocate the…
Q: Persons A and B are roommates. Person A smokes and Person B does not. The index s measures how smoky…
A: It is a classic case of Coasian bargaining. in this case B has the legal right to have clean air. s…
Q: 7. Kendal has the utility function U(x,x2)=4x +x2. If Kendal were initially consuming 25 units of…
A: since you have asked multiple questions and according to our policy we can only solve the first…
Q: Suppose a family (with 1 child) earns $50,000 per year and there is no publicly provided education.…
A: The wants of consumers are unlimited but they are forced to make choices because of the budget…
Q: How Bergson-Samuelson Social Welfare Function used in a model that considers a society's desire for…
A: let we have show that as per,According to Samuelson theory, the public good is given to the consumer…
Q: The queen of england has utility function u(x,y) =xy and the queen is endowed with basket (x,y) =…
A: Answer: Given, Utility function: ux,y=xy Endowment basket (x,y) = (4,10) At the endowment bundle the…
Q: Consider an economy with 2 goods and 2 identical agents, each of whom has the following utility…
A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: In the economy, is there only one efficient combination of goods?
A: Meaning of Production Possibility Curve/Frontier: Production possibility is a curve showing…
Q: Four individuals (call them 1,2, 3 and 4) have jointly inherited 2 assets (call them A, and B). The…
A: Pareto efficient ways of distribution refers to the most efficient way of distributing limited…
Q: Suppose Jimi has reference dependent preferences over guitars and money as in Tversky and Kahneman…
A: Meaning of Utility Function: The term utility function refers to the situation, under which an…
Q: For the rest of this question consider a two goods economy where Kim and Jung can trade Ferraris…
A: Since you have posted a question with multiple parts, we will solve only the first part. To get…
Q: Define the Various Mathematical Implications of Homoskedasticity?
A: One of the assumptions of the Classical Linear Regression Model (CLRM) is homoscedasticity. It…
Q: Four individuals (call them 1,2, 3 and 4) have jointly inherited 2 assets (call them A, and B). The…
A: Pareto efficient ways of distribution refers to the most efficient way of distributing limited…
Q: Discuss the distinction and similarities between partial and general equilibrium analysis.
A: Equilibrium is the situation where demand and supply which are two main important market forces that…
Q: Persons A and B are roommates. Person A smokes and Person B does not. The index s measures how smoky…
A: Answer in Step 2
Q: Describe the Edgeworth box.
A: Edgeworth box is a two-dimensional representation of a simple, closed economy which has two…
Q: Assume a primitive society that produces two goods: food and tools. There is a consumer that is…
A: In a market, an individual will be able to maximize his utility if the MRS of consuming two goods…
Q: Consider a community of two families A and B, who contribute EA and EB dollars to the community’s…
A: Utility function (A) = xA1/2E1/2 Utility function (B) = xB1/2E1/2 Income of both A & B = 60…
Pls Solve it quickly !!
Step by step
Solved in 2 steps
- Because Income depends on work effort and work effort depends on nutrition, suppose the relationship between income (Y) and total food availability (F) in a poor household is given by: Y = 10F + 20F2 – 0.6F3 a) If food availability in a two-person household is 20, would it be “rational” to share the food? Explain. b) If food availability in a two-person household is 30, would it be “rational” to share the food? Explain.ons 006.01.1-MC - MANK08 The principle that "people face tradeoffs" applies to a. individuals. Ob. families. c. societies. d. All of the above are correct.Anna and Bob are the only residents of a small town. The town currently funds its fire department solely from the individual contributions of these two residents. Each of the two residents has a utility function over private goods ? and total number of firemen ?, of the form: ?(?,?)=2ln?+ln?. The total provision of firemen hired, ?, is the sum of the number hired by each of the two persons: ?=??+??. Ann and Bob both have income of 200 each, and the price of both the private good and a fireman is 1. They are limited to providing between 0 and 200 firemen. For the purposes of this problem, you can treat the number of firemen as a continuous variable (it could be man-years). Consider the setup from Question 2. Suppose that the government recruits additional ?N firemen and taxes Ann and Bob equally to cover the cost. Therefore, the total number of firemen is ??+??+?MA+MB+N, where ??,??MA,MB are appropriate individually-optimal contributions of ?A and ?B(i.e., the agents behave optimally,…
- Q16 Pareto optimality refers to the maximum efficient allocation of economic resources such that there is no way that one's wealth another person worse off: this statement is choices - irrelevant -conditionally true -always true -always falseIf we write possible outcomes as (Utility of A, Utility of B), which of the following outcomes would a Utilitarian social welfare function select (7, 7) (-1, 22) (0, 13) (19, 1)suppose the government of a desert community wants to punish excessive water useage, where "excessive" is defined as any usage greater than 100 gallons/week. to do this, the government paces a flat $100 income tax on anyone who consumes more than 100 gallons/week of water in any given week (so this tax could theoretically be levied 52 times per year). people who use less than 100 gallons of water each week will not face this $100 special tax. For these problems, consider the decisions between water consumption, X(sub)w and consumption of a composite good, X(sub)c, where P(sub)w =$2/gallon and the composite good's price is numeraire. suppose michael lives in this desert community and has a weekly income of $1000. 1. graphing michels budget contraint over (X(sub)w , X(sub)c) bundles, what is the slope of his budget conraint for bundles containing MORE than 100 gallons of water? 2. What is the slope of michaels budget constraint at the point (X(sub)w, X(sub)c)=(100,750)? 3. what is the…
- Q2) B. Allocating Income to Maximize utility is essential in microeconomic theory, based on the following figures, where P of A = 3 OMR and P of B = 6 OMR Q TU of A TU of B MU of A MU of B MUA/P MUB/P 1 12 21 2 22 33 3 28 42 4 32 48 5 34 51 6 34 51 The Required: Fill the table above Explain when the Utility maximization holdsTen workers work jointly on a project. All 10 workers are equally skilled. The total value of the output produced is $100 times the sum of the number of hours worked by all 10 workers. Each worker's utility is equal to his income minus the square of the number of hours he works. Each worker is selfish. The employers have no way of keeping track of any individual's work effort, so they decide to let each person work as long as he wants to and they divide the total value of the output equally among the workers. How much income will each worker get?Suppose that Marissa is interested in buying some beers and hamburgers. Her budget constraint for these two goods is given below: If beers cost $6/beer, how much income does she have to spend on beer and hamburgers? Group of answer choices $24 $18 $12 not enough information to answer the question
- Budi and Ahmad are stranded on a remote island. Each had a few cans of bacon (D) and a few packs of macaroni cheese (M). Budi has quite flexible tastes and has a UB satisfaction function = 4D + 3M. Ahmad is a very picky person and will only eat smoked meat and cheese macaroni with a combination of 1 can of smoked meat and 2 packs of macaroni cheese. Ahmad's level of satisfaction is UA=min(D,M/2). There are only 100 cans of bacon and 200 packs of macaroni cheese. Questions: a. Draw an Edgeworth Box diagram illustrating the possible trade-offs that occur under these conditions. Determine the possible exchange rate in equilibrium. b. Suppose Ahmad has 40 cans of bacon and 80 packs of macaroni cheese. Determine the equilibrium that will occur. c. Suppose Ahmad has 60 cans of bacon and 80 packs of macaroni cheese. Determine the equilibrium that will occur. d. Suppose Ahmad, who is stronger than Budi, decides not to follow the agreed exchange rules. Determine the equilibrium that will occur.Suppose that Brooks, Inc. and Spring, Inc. form a joint venture, River Company, whose utility pumps replace the output sold by the parent companies in the domestic market. Assuming that River Company operates as a monopolist and that its costs equal MC0 = AC0, what is: (f) Assume River Company’s formation leads to technological advances that yield cost reductions, such that MC1 = AC1. Compared to the original equilibrium (in (a)), what is the net effect of River Company’s formation on welfare? (Calculate the new total surplus (consumer surplus + producer surplus), and take the difference from your answer to (a).) (g) Assume River Company’s formation leads to wage concessions from River Company employees, such that MC1 = AC1. Compared to the original equilibrium, what is the net effect of River Company’s formation on welfare? (h) Assume River Company’s formation leads to changes in work rules that lead to higher worker productivity, such that MC1 = AC1. Compared to the original…In Economics LRP means Group of answer choices a. firms can change some factors of production b. firms can change all the factors of production c. A and B d. none of the above