lst attempt Part 1 (0.5 point) 0 See Hint At any Pareto optimum, where both people consume some of each good, it must be that their marginal rates of substitution are equal. No matter what he consumes, Maurice's marginal rate of substitution (in absolute value] is equal to When Peter consumes the bundle (by, wp), his MRS (in absolute value] is 113,, x bp. Choose one: 0 A. true 0 B. false Every Pareto optimal allocation where both Peter and Maurice consume positive amounts of both goods satises the equation % = Part 2 (0.3 point) 0 See Hint At a competitive equilibrium, Maurice will have to consume some bell peppers and some whiskey. But for him to do so, it must be that the ratio of the price of whiskey to the price of bell peppers is . Therefore, we know that if we make bell peppers the numeraire, the price ofwhiskey in competitive equilibrium must be Part 3 (0.8 point) 0 See Hint At the equilibrium prices you found in Part 2 ofthis question, the value of Peter's initial endowment is At these prices, Peter will choose to consume bell peppers and bottles of whiskey. lfMaurice consumes all of the bell peppers and all of the whiskey that Peter doesn't consume, he will consume bell peppers and bottles of whiskey. Part 4 (0.5 point) 0 See H int At the competitive equilibrium prices that you found, Maurice's income is . Therefore at these prices, the cost to Maurice of consuming all of the bell peppers 3 nd all of the whiskey that Peter doesn't consume is If his income. At these prices, can Maurice aord a bundle that he likes better than the bundle consisting of all ofthe bell peppers and all ofthe whiskey that Peter doesn't consume? Choose one: 0 A. yes 0 B. no 01 Question (2 points) a See page 609 Maurice and Peter consume whiskey and bell peppers. Maurice has an initial endowment of 80 bell peppers and 20 bottles of whiskey. Peter has an initial endowment of40 bell peppers and 50 bottles of whislcey.The\\_.ur have no other assets and make no trades with anyone other than each other. For Maurice. a bell pepper and a bottle ofwhiskeyare perfect substitutes. His utility function is 11(2), 10) 2 b + m, where b is the number of bell peppers he consumes and w is the number of bottles of whiskeyr he consumes. Peter has a CobbDouglas utility function: 11(3), 10) = bu). For graphing purposes, place bell peppers on the horizontal axis, and place whiskeyr on the vertical axis