1. Define Pareto efficiency. Write down the equation that characterizes it inside an Edgeworth box with two agents, A and B, with strictly convex and strictly monotone preferences. 2. Donald thinks tacos from California are twice as good as tacos in DC, this is represented by the utility function uD = 2tCA +tDC. On top of that, tacos in California are also cheaper, being sold at $2 each, compared to DC, where the price is $3. Using the definition of bang-per-buck, explain why Donald will only eat tacos in California. 3. Explain the First Fundamental Theorem of Welfare Economics (that a competitive equilibrium is Pareto Efficient). Use up to two equations to describe it. 4. Explain why non-discriminating monopolies are not Pareto efficient. Then write the equation that char- acterizes its optimal strategy and describe it in your own words. 5. Suppose the indifference curves of a given consumer cross. Explain why this is inconsistent with the tran- sitive property. Feel free to use a graph. Hint: Write down the definition of transitivity and the definition of utility representation first (that u() represents when...)