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Consider a two-consumer economy in which A = (1,1), B = (3,0),u A (x 1 A , x 2 A ) =x 1 A x
Consider a two-consumer economy in whichA= (1,1),B= (3,0),uA(x1A, x2A) =x1Ax2AanduB(x1B,x2B) = (x1B)2x2B. A and B represent the consumers.
a) Derive the Pareto set of this economy
b) Derive fair allocations
c) Derive a competitive equilibrium for this economy that generates the allocations found in "b)"
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