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17. Extension question:2 Suppose that there were 30 units of consumption total in the economy. Find the allocation of resources that maximizes social welfare. How
17. Extension question:2 Suppose that there were 30 units of consumption total in the economy. Find the allocation of resources that maximizes social welfare. How many units does Joe get in the allocation that maximizes social welfare? (You may Show your work for partial credit.) (4 points) Suppose that there are two agents, Joe and Kamala. The social welfare function is SWF = 5Uj 4-3de Each agent has utility function U i = ln(c) where c is the amount of some composite good consumed, and i indexes the agent, with 3' representing Joe and k: representing Kamala. We write allocations as (0,413,), that is, Joe's consumption and then Kamala's. 1Why does the social welfare function have different weights on the utility of the agents? It could be biased or sexist. It could be an attempt to rescale utility because Joe is just a. sadder person who requires more utils to get the same joy as Kamala. Or it could be a way of representing inequality, where perhaps Joe has lower income, so in the context of one particular policy, we care more about giving him some utility
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