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Assume the setting outlined in Question 1. Suppose that the social planner considers it to be imperative that agent B consumes exactly one unit of
Assume the setting outlined in Question 1. Suppose that the social planner considers it to be imperative that agent B consumes exactly one unit of good 1 and four units of good 2. Although the social planner can not force the individuals to a particular consumption, they can enforce transfers of good 1 between the consumers (transfers ofgood 2 are not enforceable by the social planner). What transfer of good 1 would guarantee that in the resulting competitive Walrasian equilibrium consumerB consumes one unit of good 1 and four units ofgood 2? Select one: 0 a. One halfunit of good 1 has to be transferred from agent A to agent B. O b' There is no endowment for which agent B would consume $13 = 1 and $23 = 4 in the corresponding competitive equilibrium. Therefore, no such transfers exist. 0 C' One unit of good 1 has to be transferred from agent A to agent B. 0 d. Transferring good 1 is not sufficient. It is necessary to transfer one unit of good 2 from agent A to agent B
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