ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Transcribed Image Text:Consider the diagram below. Legislation allows Angela, a farmer, to be at point F.
Angela's reservation
indifference curve, IC, Angela's best feasible
12-
indifference curve when
an independent farmer,
ICO
8-
D
F
FF: Angela and Bruno combined
16
24
Angela's hours of free time
If Angela, a farmer, and Bruno, her landlord, can bargain costlessly:
Select one or more:
a. The final outcome will be unchanged.
O b. The final outcome will be a Pareto improvement.
O c. The final outcome could be anywhere on the "contract curve" of Pareto-efficient points between C and D.
O d. The final outcome will be somewhere between (or at) points C and I.
Bushels of grain
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