Find all Pareto optimal allocations, the egalitarian allocation and the competitive equilibrium with equal incomes for the following problems. 1 Ann and Bob need to divide 4 items. Their preferences are as follows: Y W Ann 25 25 25 25 Bob 10 20 30 40
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- Come up with an example with four agents and four items in which there is only one Pareto efficient allocationQ. It is possible to have a Pareto efficient allocation where everyone is worse off than they are at an allocation that is not Pareto efficient?Are allocations methods more or less efficient than other methods?
- Consider an economy inhabited by George and Harriet, whose utility functions are Ug : (ac)² (bc)2 Он тан + 2bн The total quantities of ale and bread that can be produced by the economy are a and b, and they are constrained by the production function b = 2(10 – a)/2 There are infinitely many Pareto optimal allocations. In one of them, Harriet's utility is 8. a) An allocation in this economy is described by a list of four variables. What are these variables? b) What four equations describe the Pareto optimal allocation in which Harriet's utility is 8? c) Find this Pareto optimal allocation.Define what we mean by Pareto optimality and given an example of a Pareto optimal allocationExplain the statement true or false. Give an example of pay-off matrix to explain the solution. "It is possible to have a Pareto efficient allocation where someone is worse off than she is at an allocation that is not Pareto efficient"
- Please define and draw the utility possibilities curve. On your graph explain what is meant by pareto efficiency. Define social welfare functions. On your graph demonstrate that some efficient points need not be as good, given the social welfare function, as some inefficient points.Consider an economy with two people, Li and Carlo, and two commodities, clothing and food. Currently, Li and Carlo would both be willing to give up 0.5 articles of clothing for one piece of food. Further, the workers in town can, in a given day, produce either 10 pieces of clothing or 50 pieces of food. Is the allocation of resources in this economy Pareto efficient? If not, should there be more clothing or more food? (Let the MRS=MUfood/MUclothing=the value of food in terms of clothing=how much clothing we would trade for 1 more food)Is it possible to have a Pareto efficient allocation where everyone is worse off than they are at an allocation that is not Pareto efficient? Clearly define Pareto efficiency and explain your answer.
- Please help me answer this. 1. Graph and Explain the meaning of Edgeworth box. 2. What is Notion of the pareto optimality? Graph your answer.Consider a two-person endowment economy characterized by the Edgeworth Box below: a. b. C. X2. OA A E B OB X1 Are the allocations depicted at points A and B Pareto efficient? Explain your reasoning. Add bowed indifference curves that reflect the utility that the two consumers get from the endowment depicted at point E (assume that they value both goods). What is meant by the term "Pareto improvement." In your diagram highlight the set of Pareto improving allocations given the endowment.7 Ann and Bob are dividing a cake made up by 1/3 chocolate parts and 2/3 vanilla parts. Ann likes vanilla twice as much as chocolate and Bob likes vanilla just as much as he likes chocolate. What division of the cake is suggested by the egalitarian solution? By the competitive equilibrium with equal incomes? Also name one allocation that is not Pareto optimal.