Question: economics question Consider two consumers i= A, B with identical preferences over goods j=x, y: Ui = xi yi. Assume the following endowments: EA= XA=
economics question

Consider two consumers i= A, B with identical preferences over goods j=x, y: Ui = xi yi. Assume the following endowments: EA= XA= 2, yA= 8 and EB = (xB = 10 , yB = 2). Answer each of the following questions based on this information. Round your answer to the nearest second decimal place (i.e., .01). a). Calculate A's utility under autarky. b). Calculate B's utility under autarky. c). Suppose B gives A 4 units of x in exchange for 3 units of y. Calculate A's resulting utility. d). Suppose B gives A 4 units of x in exchange for 3 units of y. Calculate B's resulting utility. e). Starting from the outcome of the trade described above, are there any additional trades that could improve A's situation without hurting B or that could improve B's situation without hurting A? i). YES ii). NO iii). Maybe f). Calculate the price of good x in units of good y (or px/ py) that implies neither consumer would want to make any further trades beyond that described above. Comments
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