Solved

A Small Economy Has Only Two Consumers, Charlie and Doreen

Question 1

Multiple Choice

A small economy has only two consumers, Charlie and Doreen.Charlie's utility function is U(x, y) = x + 154y1/2.Doreen's utility function is U(x, y) = x + 7y.At a Pareto optimal allocation in which both individuals consume some of each good, how much y does Charlie consume?


A) 121
B) 9
C) 22
D) 18
E) We can't tell without knowing the initial endowments.

Correct Answer:

verifed

Verified

Related Questions