Question: 8. Consider trade between two consumers (1 and 2) and two goods, X and Y. Suppose the total quantities of each good are 100 units.

8. Consider trade between two consumers (1 and 2) and two goods, X and Y. Suppose the total quantities of each good are 100 units. Each consumer has Cobb-Douglas preferences given by: U(X, Y) = XY. What is the shape of the contract curve, i.e. derive the equation? How does the contract curve change if consumer one has the utility function U(X, Y) = X2Y while the other consumer's preferences are as before? Again, derive the equation for the contract curve

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