Consider trade between two consumers (1 and 2) and two goods, X and Y. Suppose the total quantities of each good are 100 units. Each consumer has Cobb-Douglas preferences given by: U(X,Y) = XY Denoting by X1 the first consumer's consumption of X and by Y1 the first consumer's consumption of Y, the contract curve consists of all allocations where A. X1 = 0.5Y1 B. X1 = 2Y1 C. X1 = Y1 square D. X1 = Y1 %3D %3D

Please answer the question fully and completely else I will rate negative, thanks! Question 3 Consider an economy with two consumers, A and B, two goods called 1 and 2 and one firm. Consumers A and B are each endowed with a unit of each good. The utility functions of each consumer are: A: 13 4 4 u (x₁‚x2 ) = lnx₁ + Inx2 B:u ₁₂ (x, ‚ x 2 ) = x, x 2 The firm B 1 A 1 1 2 produces good 2 using good 1 as an input, according to the production function f(y) = y where y is the quantity of good 1. Consumer A is the sole shareholder of the firm and the firm operates to maximize profit. Page 2 If P₁ and P2 determine the utility maximizing demand of consumer are the per unit prices of goods 1 and 2, . B for each good as a function of p, and P2 · If P₁ P 2 1 and are the per unit prices of goods 1 and 2, determine the profit maximizing demand of the firm for good 1 as a function of p₁ and p2. Ifp, and p2 are the per unit 1 prices of goods 1 and 2, determine the utility maximizing demand of consumer…

1.  a) Consider an economy with 3 agents, Mohammed (M), David (D) and Susan (S). There are two goods available, good x, and good y. The marginal rates of substitution (where good x is on the horizontal axis and good y is on the vertical axis) are given by for Mohammed,  for David and  for  Mohammed and David are both consuming twice as much of the good x than good y, while Susan is consuming equal amounts of x and y. What are the conditions for Pareto efficiency in an exchange economy? Are these consumption levels economically efficient?  Can these consumption allocations be observed in a perfectly competitive equilibrium in an exchange economy without production? Explain. b.  There are two firms in the economy. Each firm employs positive amounts of capital and labour. The technology satisfies diminishing marginal rate of technical substitution of labour for capital. Currently, A’s marginal rate of technical substitution of labour for capital is 4 while B’s marginal rate of technical…

Consider a market with two households (A and B) and two goods (X and Y). Each household holds 12 units of each good. Household A has a utility UA = 5 In LA + In yA when it consumes bundle (*A, YA). Household B hasa utility UB = In aB+5 Inyg when it consumes bundle (гв, ув). The market reaches an equilibrium when the price of each good is $1. Which, of the following sentences, correctly explains what happens in the market? Household A purchases 8 units of good X from household B. Household B purchases 8 units of good Y from household A. Household A purchases 7 units of good Y from household B. Household B purchases 7 units of good X from household A. Household A purchases 9 units of good X from household B. Household B purchases 9 units of good Y from household A. O Household A purchases 7 units of good X from household B. Household B purchases 7 units of good Y from household A. Household A purchases 9 units of good Y from household B. Household B purchases 9 units of good X from…