Question: Please help me solve the following question, the information required is given. If you can't solve h, it's okay. Please focus on f and g.

Please help me solve the following question, the information required is given. If you can't solve h, it's okay. Please focus on f and g.

Please help me solve the following question, the information required is given.

1. Pure exchange economy: The economy has two agents and infinite time horizon. There is one consumption good in the economy. Utility of agents are: U( c') = [ B(a )- 1 - y where y is a risk aversion parameter. Notice that the consumer has Constant Relative Risk Aversion (CRRA) utility function. Each consumer is endowed with a sequence of consumption goods {et}=0,1,2,.... (f) Characterize the competitive equilibrium defined in (c). (That is, write down first order conditions and other equations necessary to solve the equilibrium.) g) Characterize Social Planner's solution (Write down first order conditions and other equations necessary to solve the problem) (h) Now, endowment is given as follows: Time : 0, 1, 2, 3, ... Consumer 1 (el) : 2, 3, 2, 3, ... (2) Consumer 2 (e?) : 3, 2, 3, 2, ... (3) That is, el = 2 for t : even and et = 3 for t : odd. Analogously, e? = 3 for t : even and e? = 2 for t : odd. In this environment, answer the followings: i. Solve for the Competitive Equilibrium defined in (c) ii. Solve for the Social Planner's problem defined in (e) iii. State First Welfare Theorem. Does the theorem hold? Verify it. iv. State Second Welfare Theorem. Does the theorem hold? Verify it

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