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PLZ PLZ HELP ME and the answers on net are wrong Consider a world in which there are only two dates: 0 and 1. At

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PLZ PLZ HELP ME and the answers on net are wrong

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Consider a world in which there are only two dates: 0 and 1. At date 1 there are three possible states of nature: a good weather state (G), a fair weather state (F), and a bad weather state (B). Denote S, as the set of these states, i.e., s] E S1 = {G, F, B}. The state at date zero is known. Denote probabilities of the three states as 7 = (0.4, 0.3, 0.3). There is one non-storable consumption good, apple. There are three consumers in this economy. Their preferences over apples are exactly the same and are given by the following expected utility function where subscript k = 1, 2,3 denotes each consumer. In period 0, the three consumers have a linear utility and, in period 1, the three consumers have the same instantaneous utility function: u (c) = 1-y' where y = 0.2 (the coefficient of relative risk aversion). The consumers' time discount factor, B, is 0.98. The consumers differ in their endowments, which are given in the table below: Endowments t= 0 t=1 So G F B Consumer 1 0.4 3.2 1.8 0.9 Consumer 2 1.2 1.6 1.2 0.4 Consumer 3 2.0 1.2 0.6 0.2Assume that atomic (Arrow-Debreu) securities are traded in this economy. One unit of 'G security' sells at time 0 at a price q and pays one unit of consumption at time 1 if state 'G' occurs and nothing otherwise. One unit of 'F security' sells at time 0 at a price qp and pays one unit of consumption at time 1 if state 'F' occurs and nothing otherwise. One unit of 'B security' sells at time 0 at a price qs and pays one unit of consumption in state 'B' only

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