The following information is the starting point for Q16 – 20. Consider an exchange economy with two agents, 1 and 2, and two goods, X and Y. Agent l's endowment is (0,10) and agent 2 's endowment is (11,0) . Agent 1 strictly prefers bundle (a, b) to bundle (c, d) if, either a > c, or a = c and b > d. Agent 2 strictly prefers bundle (a, b) to bundle (c, d) if min{a, b} > min{c, d}. For both agents, we say that bundle (a, b) is indifferent to bundle (c, d) if, neither (a, b), nor (c, d), is strictly preferred to the other. 16. This exchange economy has DSE 2014 Indox Pogo 120

The economies of North Korea and India are: different in that North Korea has a command system, while India has a market system.   similar in that they are both basically command systems.   similar in that they are both basically market systems.   different in that India has a command system, while North Korea has a market system.

Give typing answer with explanation and conclusion    Consider an exchange economy consisting of two people, A and B, endowed with two goods, 1 and 2. Person A is initially endowed with ωA = (0,10) and person B is initially endowed with ωB = (11,0). They have identical preferences, which are given by U^A(x1,x2) = U^B(x1,x2) = x1^2*x2. Suppose that p2 =1. Under the competitive equilibrium, what is p1? Round answers to two decimal places.

Problem 3: Production-exchange economy Consider an economy with two consumers, A and B, two goods, X and Y, two factors of production, labor and capital, and two firms: firm X uses labor and capital to produce good X and firm Y uses labor and capital to produce good Y. Consumer A has no initial endowments of labor or capital but owns both of the firms. Consumer B has an initial endowment of labor Is =L>0 and an initial endowment of capital kg = K = L, but does not own any share of the firms. Both consumers i = A, B have preferences over consumption bundles can be represented by the Cobb-Douglas utility function where r; is the quantity of good X for consumer i, y; is the quantity of good Y for consumer i, and a e (0, 1) is a preference parameter. Firm X produces the output good X with a technology that can be de- scribed by the following production function: fx(lx, kx) = lx + kx, where lx is the quantity of labor and kx is the quantity of capital. Firm Y produces the output good Y with…