Suppose there are two consumers A and B and two goods X and Y m. Consumer A's
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Question:
Suppose there are two consumers A and B and two goods X and Y m. Consumer A's utility function is given by Ua(x,y) =X+Y. Consuner B's utility function is given by Ub = 2X + Y. Consumer A's initial endowment is X = 4 and Y = 0. Consumer B's initial endowment is X =4 and Y= 8. Which of the following allocation of X is not in the core?
- All of the above is in the core
- rhe initial allocation is Pareto efficient m, so the core is empty
- A gets 0 and X and 5 of Y; B get 8 units of X and 3 units of Y
- A gets 1 unit of X and 4 units of Y; B gets 7 units of X and 4 units of Y
- A gets 0 units of X and 6 units of Y; B gets 8 units of X and 2 units of Y
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