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Consider the following exchange economy. (a) Suppose that the three consumers have utility functions: u1(x11,x12)=ln(x11)+x12,u2(x21,x22)=x21+ln(x22)u3(x31,x32)=2x31+x32 and all consumers consume strictly positive quantities of both goods?
Consider the following exchange economy. (a) Suppose that the three consumers have utility functions: u1(x11,x12)=ln(x11)+x12,u2(x21,x22)=x21+ln(x22)u3(x31,x32)=2x31+x32 and all consumers consume strictly positive quantities of both goods? Determine the equilibrium price vector with p1=1. (b) Find a competitive equilibrium allocation for the economy where the agents have utility functions as above and the initial endowments are: 1=(0,3),2=(2,1),3=(3,3). Consider the following exchange economy. (a) Suppose that the three consumers have utility functions: u1(x11,x12)=ln(x11)+x12,u2(x21,x22)=x21+ln(x22)u3(x31,x32)=2x31+x32 and all consumers consume strictly positive quantities of both goods? Determine the equilibrium price vector with p1=1. (b) Find a competitive equilibrium allocation for the economy where the agents have utility functions as above and the initial endowments are: 1=(0,3),2=(2,1),3=(3,3)
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