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Suppose the following world. There are two members of society, Wayne and Garth. There are two goods in the world: cups of Coffee (C) and

Suppose the following world. There are two members of society, Wayne and Garth. There are two goods in the world: cups of Coffee (C) and Donuts (D). Wayne likes to drink exactly 3 cups of Coffee with each Donut that he eats. He does not receive any utility from Coffee or Donuts outside this preferred ratio. His preferences can be expressed as follows: UW (C, D) = min{C, 3D}. This means that, for example, if Wayne has 3 Coffees and 1 Donut, his utility level is 3. And if Wayne has 3 Coffees and 3 Donuts, his utility level is also 3. Garth, on the other hand, likes to eat exactly 3 Donuts with every cup of Coffee that he drinks. He does not receive any utility from Coffee or Donuts outside this preferred ratio. His preferences can be expressed as follows: UG(C, D) = min{3C, D}. This means, for example, that if Garth has 3 Donuts and 1 Coffee, his utility level is 3. And if Garth has 3 Donuts and 3 Coffees, his utility level is also 3. Suppose the price of Coffee is $1, the price of Donuts is $1, and Wayne and Garth each have $280

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