Q1. Suppose we have two individuals UA (x41, XA2) = (x4, ) a ( x 4, ) I- a UB(xB 1, XB2) = (xB, ) a ( xB 2 ) 1-a And the initial endowments are (wl,w 2) = (0,6); (wl,w 2) = (4,0) (a) Question 1: Draw the Edgeworth Box and label it (b) Question 2: Draw the endowment in the box (c) Find the equations for the optimal demand given p1, p2, w l, W 2, W l, W 2 (d) Find the equation for, and draw in the box, the contract curve. (e) Write out an equation that shows that the total demand for each good is equal to the total quantity available (i.e. the supply). This is the market clearing condition. (f) Given endowment, please write down the demand function for each individual. (g Substitute the optimal demand functions into the market clearing conditions to solve out for the equilibrium price ratio (h) Find the equilibrium allocations for individual A and B given the equilibrium price ratio. (i) Given the equilibrium prices, please draw the budget line in the Edgeworth Box and draw the allocation