Adrienne and Stephen consume pizza, Z, and cola, C. Adriennes utility function is UA = ZACA, and

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Adrienne and Stephen consume pizza, Z, and cola, C. Adrienne’s utility function is UA = ZACA, and Stephen’s is UA = Z0.5 s C0.5 s . Their endowments are ZA = 10, CA = 20, ZS = 20, and CS = 10.

a. What are the marginal rates of substitution for each person?

b. What is the formula for the contract curve?

Draw an Edgeworth box and indicate the contract curve. (Hint: See Solved Problem 10.3.) M

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Microeconomics Theory And Applications With Calculus

ISBN: 9780133019933

3rd Edition

Authors: Jeffrey M. Perloff

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Question Posted: Nov 15, 2024 02:00 AM

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Adrienne and Stephen consume pizza, Z, and cola, C. Adriennes utility function is UA = ZACA, and

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Microeconomics Theory And Applications With Calculus

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