What are Abby and Brads gross and excess demand functions?

) Suppose Abby has an endowment of (w1A ;w2A) = (6; 4) and Brad has an endowmentof (w1A;w2A) = (4; 6 Show more ) Suppose Abby has an endowment of (w1A ;w2A) = (6; 4) and Brad has an endowmentof (w1A;w2A) = (4; 6). a) Draw an Edgeworth Box representing this situation. Label the endowment point. b) Suppose Abby has the utility function u(x1A; x2A) = x1Ax2A and Brad has the utility function u(x1B; x2B) = x1Bx2 B (Note the superscripts here denote good 1 and good 2 they are not exponents). What are Abby and Brads gross and excess demand functions? c) Suppose a Walrasian auctioneer announces prices (p1; p2) = (2; 1). What is the aggregate excess demand for each good? Is this an equilibrium? Why or why not? d) Suppose that instead of the utility functions given above Abbys utility function isu(x1A; x2A) = (x1A)2x2A and Brads is u(x1B; x2B) = x1B(x2B)2. Find equilibrium prices Leave a comment Post comment Expert Answer Show less

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