Question
Elsa and the Night's King are stuck in a frigid, artic icescape Beyond the Wall, also known as State College. It is winter and there
Elsa and the Night's King are stuck in a frigid, artic icescape Beyond the Wall, also known as State College. It is winter and there is no one else around. There are only two goods in State College, beer (B) and blue sweatshirts (S). Elsa has the production function: 6B+2S=400, while the Night's King has the production function 2B+S=300. If they could not trade, Elsa would produce and consume 60 Beers, while the Night's King would produce and consume 150 sweatshirts. Now assume that Elsa and Night's King meet. Provide a mutually beneficial trade that would make both better off. Be sure to carefully explain how you came to this trade.
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