Question: Topic: Exchange Difficulty: 3 % Correct Responses: 75 Discrimination Index: 29 Correct Answer: D 29.8 Holly and Steven both consume the same goods in a

Topic: Exchange Difficulty: 3 % Correct Responses: 75 Discrimination Index: 29 Correct Answer: D 29.8 Holly and Steven both consume the same goods in a pure exchange economy. Holly is originally endowed with 5 units of good 1 and 3 units of good 2. Steven is originally endowed with 5 units of good 1 and 2 units of good 2. They both have the utility function U(21, 12) = 1," If we let good 1 be the numeraire, so that p, = 1, then what will be the equilibrium price of good 2? (a) 2 (b) 8 (c) 1 (d) 4 (e) 2

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