Question: Let there beconsumers all with the same utility functionand the same income of 1. The price of the private goodand the public goodare both 1.

Let there beconsumers all with the same utility functionand the same income of 1. The price of the private goodand the public goodare both 1.

a.Calculate the private equilibrium (Competitive equilibrium)

b.Find the social optimum for the welfare function.

c.Comment on the effect of changingon the contrast between the equilibrium and the optimum.

income of 1. The price of the private goodand the public goodare

Problem 3: [10 points] Let there be \" consumers all with the same utility function \"i = \"("9 + 1\"\" = i: 1'3) m" and the same income of l. The price of the private good ('0 and the public good (G) are both 1. 3. Calculate the private equilibrium (Competitive equilibrium) b. Find the social optimum for the welfare function W = 2321\"\". c. Comment on the effect of changing " on the contrast between the equilibrium and the optimum

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