Question 2) Joey and Ross are the two consumers of our 'Friends' economy. There are 100 units of sandwiches and 100 units of salt water taf?es. Joey says, 'I can take or leave salt water taf?es, but I love sandwiches'. Ross says, 'I love salt water tallies, but I can take or leave sandwiches'. a.Draw an Edgeworth box for our 'Friends' economy and sketch Joey and Ross1 preferences. Explain. [10 Marks] b. Joey is endowed with 100 units of each good, initially. Find the Walrasian equilibrium(a) and discuss. [10 Marks] c. What would happen if Joey hands over 50 units of each good to Ross? Discuss. [10 Marks]

pur-new-sol

Related Questions