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Question 4 [8 points} [8 marks] For the following question, - You get 2 marks for choosing the correct answer. - You get up to
Question 4 [8 points} [8 marks] For the following question, - You get 2 marks for choosing the correct answer. - You get up to 6 marks for the detailed solution. You need to explain each option whether it is true or false to get the full mark. In a small country there are only two goods, xand y. The only scarce resource is land. There are 1,000 acres of land. One acre of land will produce either 20 units of xor 15 units of y. Some citizens have larger lands, some have smaller. The citizens of the country all have utility functions of the form U (x, y} = 13?. At every Pareto optimal allocation, {a} the number of units of xproduced equals the number of units of yproduced. {b} total xproduction is 10,000 units. {c} all citizens consume the same commodity bundle. {d} eyery consumer's marginal rate of substitution between xand yis -1. {e} None of the above is true at every Pareto optimal allocation
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