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Consider an exchange economy with two agents, A and B, and two goods, x and y. For graphing purposes, agent A will have the origin
Consider an exchange economy with two agents, A and B, and two goods, x and y. For graphing purposes, agent A will have the origin or the bottom-left corner of the graph, and agent B will have the origin on the top-right corner. Good x will be measured on the horizontal axes, and good y will be measured on the vertical axes. The initial endowment for agent B is B=(27,12). Both agents have the same utility function, u(x,y)=xy. On the Edgeworth box below, the indifference curves that each agent is on at the endowment point have already been traced out. Use the dot to indicate the endowment point. Also, plot the contract curve. To refer to the graphing tutorial for this question type, please click here. Consider an exchange economy with two agents, A and B, and two goods, x and y. For graphing purposes, agent A will have the origin or the bottom-left corner of the graph, and agent B will have the origin on the top-right corner. Good x will be measured on the horizontal axes, and good y will be measured on the vertical axes. The initial endowment for agent B is B=(27,12). Both agents have the same utility function, u(x,y)=xy. On the Edgeworth box below, the indifference curves that each agent is on at the endowment point have already been traced out. Use the dot to indicate the endowment point. Also, plot the contract curve. To refer to the graphing tutorial for this question type, please click here
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