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2 Question 2 (32 points) Suppose there are 2 consumers, A and B. The utility functions of each consumer are given by: Loam) = xir'a'

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2 Question 2 (32 points) Suppose there are 2 consumers, A and B. The utility functions of each consumer are given by: Loam) = xir'a' may; = 3X + 21/ The initial endowments are: W} = law? =s,wx =4,wg = m a) [23 points] Using an Edgeworth Box, graph the initial allocation [label it W] and draw the indifference curve for each consumer that runs through the initial allocation. Also draw the contract curve and the more Be sure to label your graph carefull},r and accurately. b) [3 points} What is the marginal rate of aulntitution for consumer A at the initial allocation? c) [3 points) 1What is the MRS for consumer B at the intial allocation? d) [3 points} Is the initial allocation Pareto eicient? How do you know

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