In another economy consumer 1 has no x and 8 units of y and the utility fucntion U(x,y) = x - (1/4)y². Consumer 2 has 16 units of x and 8 units of y and the utility function U(x,y) = x +2y^(1/2). Describe the set of pareto optimal allocations for this economy. Math not required; just intution. If possible, include the Edgeworth box.

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Two consumers hae identical utility functions, U(x,y) = Max(x,y). There are eight units of x and eight units of y. What are the pareto optimal allocations for this economy? Math not required (intuition question). If possible, include the Edgeworth box.

Hi, my question is about Pareto optimal.

There are 2 consumers and 2 commodities. Consumer A's initial endowment is 4 units of good x and 1 unit of y, and the utility function is U=x*y. Consumer B's initial endowment is 0 unit of x and 7 units of B, and the utility function is U=min{x,y}.

Question: 1) show the locus of Pareto optimal allocations.

2) let good x be the numeraire (price=1) and p denote the price of goody. Write the expression for the amount of goody that consumer B will demand at these prices.

Please show all work and thank you in advance for your help!

grayhamster931

Suppose that there are two goods (X and Y). The price of X is $2 per unitu, and the price of Y is $1 per unit. There are two consumers ( A and B). The utility functions for the consumers are: for consumer A: U (X,Y)= X^.5Y^.5 and for consumer B: U(X,Y)=X^.8Y^.2

Consumer A has an income of $100, and Consumer B has an income of $300.

1. Derive the marginal utlities of goods X and Y for consumer A

2. Derive the marginal utilities of goods X and Y for consumer B

3. Set consumer A's MRS equal to the price ratio. Then use the budget constraint to solve for her optimal bundle

4. Set consumer B's MRS equal to the price ratio. Then use the budget contraint to solve for his optimal consumption bundle.

5. Calculate the MRS for each consumer at their optimal consumption bundles.

6. Suppose that there is another conusmer (let's call her C). You don't know anything about her utility function or her income. All you know is that she consumes both goods. What do you know about C's MRS at her optimal consumption bundle? Why?