Question
An economy with many consumers (Amy, Hao, ...), many producers, two goods (A and B) and two inputs (L and K) is in a competitive
An economy with many consumers (Amy, Hao, ...), many producers, two goods (A and B) and two inputs (L and K) is in a competitive general equilibrium. Which of the following conditions are satisfied in this economy?
All that apply:
a) For every possible redistribution of inputs among the firms, the quantity of one output cannot be increased without decreasing the quantity of the other
b) MUAmyA = MCA and MUAmyB = MCB
c) For every possible redistribution of goods among the consumers, some of them will be better off and some of them will be worse off.
d) MRS = MRT
e) MRS = MRTS
f) PA = MCA and PB = MCB
g) MUAmyA = MUHaoA = PA
h) MRTS = PA / PB
i) MRSAB = PA / PB for all consumers
j) MRTS between labour and capital is the same for all firms, whether producing good A or good B.
k) the ratio of input marginal products must be equal to the ratio of input prices
l) MRT = MRTS for all firms, whether producing good A or good B
m) The absolute value of the slope of PPF (with good A on the horizontal axis) is equal to MCA / MCB, the ratio of marginal costs of producing goods A and B, at any point on PPF
n) MRT = w/r, where w is wage and r is the price of capital
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