Question: Please help solve problem a and b, thank you. Show mathematically how loss aversion can help explain the result of the endowment effect experiment. We

Please help solve problem a and b, thank you.

Show mathematically how loss aversion can help explain the result of the endowment effect experiment. We will break this down into several steps. First, some assumptions and notation: Suppose the value of a certain bundle of cash (6) and mugs (m) given a reference point in cash (Tc ) and a reference point in mugs (Tm ) is v(c,m|rc,7'm) = c + m + p,(c TC) + \"(m rm), where (z): z .220 p. Az z

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