Sarah and Andrew are two traders in a pure exchange economic with two goods, Bikes (B) and Computers (C). Sarah's preferences are described by the Cobb-Douglas Utility function:

Assume the price of Bikes is 1 and the price of computers isp. The initial endowments areB_A= 10,B_S= 20,C_A= 20 andC_S= 10. What is the equilibrium price of computers relative to bikes (p)?

Your Answer:

Question 11 (1 point} Sarah and Andrew are two traders in a pure exchange economic with two goods, Bikes (B) and Computers [C]. Sarah's preferences are described by the Cobb-Douglas Utility function: _ 1/3 2/3 Andrew's preferences are given by: _ 1/2 lf2 Assume the price of Bikes is '1 and the price of computers is p. The initial endowments are EA = 10, 35 = 20. CA = 20 and C5 = 10. What is the equilibrium price of computers relative to bikes (,0)? Your