Illustrate what is the equilibrium quantity of bananas and, Ask an Expert

Economics

(i) Marilyn and Chen live in an isolated valley and trade with no-one but each other. They consume only bananas and tomatoes. Marilyn has an initial endowment of 4 bananas and 11 tomatoes. Chen has an initial endowment of 20 bananas and 27 tomatoes. For Marilyn, the two goods are perfect substitutes, one-for-one. For Chen, they are perfect complements, one-for-one.

a) Show the endowment situation in an Edgeworth box diagram, with Marilyn on the bottom left corner and Chen on the top right corner.

b) In competitive equilibrium, what is the ratio of the price of bananas to the price of tomatoes?

c) Illustrate what is the equilibrium quantity of bananas and tomatoes consumed by Marilyn and Chen?

View complete question

Business Economics, Economics

Category:- Business Economics
Reference No.:- M9282490

Have any Question?Write your Review or question?

Related Questions in Business Economics

What is the difference between a greenfield investment and

What is the difference between a greenfield investment and an acquisition? Which form of investment is a firm more likely to choose?

Answer in true or false1 in the circular flow model firms

Answer in true or False : 1) In the circular flow model, firms sell the services of factors of production to households 2) If GDP included the value of leisure time, the value of US GDP would most likely increase. 3) GDP ...

In a survey of women in a certain country ages 20-29 the

In a survey of women in a certain country? (ages 20-?29), the mean height was 65.3 inches with a standard deviation of 2.71 inches. Answer the following questions about the specified normal distribution. ?(a) What height ...

Suppose the restaurant industry is perfectly competitive

Suppose the restaurant industry is perfectly competitive and all producers have identical cost curves. The industry is currently at a long-run equilibrium, with each firm producing at its minimum long run average total c ...

Inc 409661 2796 pop sample size 400se 5458

INC = 40966.1 + 2.796 POP' sample size = 400 (se) (545.8) (.2796); R2 = .2468 1. Where INC is the income in millions of dollars and POP the population in millions of people. Provide an interpretation of the slope of the ...

Suppose the cross-price elasticity of demand between goods

Suppose the cross-price elasticity of demand between goods X and Y is -4. How much would the price of good Y have to change in order to change the consumption of good X by 10 percent?

In the us 82 of police officers have graduated from a

In the U.S., 82% of police officers have graduated from a police academy. If 300 police officers are chosen at random, what is the probability that at least 75% have graduated from a police academy? Keep intermediate ste ...

A coffee manufacturer is interested in the mean daily

A coffee manufacturer is interested in the mean daily consumption of regular-coffee drinkers and decaffeinated coffee drinkers. The random sample of 50 regular-coffee drinker show a mean of 3.84 cups per day. A sample of ...

1- a fencer attends a fencing tournament to ensure the

1- A fencer attends a fencing tournament. To ensure the equipment works well, he takes three blades. Two of them will be the backup. The probability of his three blades to function properly are 0.95, 0.8, 0.7 respectivel ...

A study sample was done regarding the association between

A study sample was done regarding the association between family history and the risk of developing AD. Exposure were family history of AD and no family history of AD. Outcomes were development of AD or no development of ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Business Economics Expert