2 This Guestion Is From Final 2016 Consider An Exchange Economx Composed Of Two Indi 3277074

2) This guestion is from Final 2016. Consider an Exchange economx composed of twO individuals A and B and two goods x1 and x2. Individual A has an endowment of WA-(3,5) and individual B has an endowment of Ws- (3,3). A’s utility function is given by UA- Xx2 a. (3 points) Show that no matter what utility function B has, there exists a Pareto Efficient (PE) allocation. (i.e. Speci?a Pareto efficient allocation and explain why it is efficient nomatter what utility function B has) b. (14 points) Suppose that B is neutral about x1 (neither increasing nor decreasing the amount of x1 affects her utility) and she prefers more of x2 to less. Do the Specify a utility function for B 2 )Draw the Edgeworth box and sketch the indifference curves passing through the endowment 3) Is the endowment Pareto efficient? 4) Find the set of all Pareta efficient allocations 3) (8 points) This guestion is from Final 2017. Consider an exchange economy composed of two individuals A and B and two goods xi and x2. Individual A has an endowment of W,(2,2) and individualB has an endowment of We_ (2,2). Sutlit?functionis givenby UA- 2X1 + 3 x2. Individual B’s utility function is given by Ug- 3X1 +2×2. Draw the set of all Pareto efficient allocations,

 

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