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Answer to Question #2637 in Microeconomics for Mrinal
Question #2637
Consider the following exchange economy with 2 consumers and 2
goods.
U1= min {X1,Y1} endowement (2,1)
U2= X2 + Y2 endowement (0,2)
(a) Explain why the allocation [(2,3),(0,0)] is not pareto efficient.
(b) What is the core for this economy? Illustrate in an Edgeworth
Box diagram.
goods.
U1= min {X1,Y1} endowement (2,1)
U2= X2 + Y2 endowement (0,2)
(a) Explain why the allocation [(2,3),(0,0)] is not pareto efficient.
(b) What is the core for this economy? Illustrate in an Edgeworth
Box diagram.
Expert's answer
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