spring2009_midterm2_makeup

spring2009_midterm2_makeup - Second Midterm Exam Econ 150b....

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Second Midterm Exam Econ 150b. Intermediate Microeconomics April 9, 2009 Please write your name and discussion-section time on each blue book. 1. (50 points.) Consider an economy with two goods, labeled 1 and 2, two consumers, labeled A and B , and one firm. Write .! A 1 ; ! A 2 / and .! B 1 ; ! B 2 / for the endowments of consumers A and B , respectively. Let ± A 2 .0; 1/ designate A ’s share of the firm’s profit, so that B 0 s share is ± B D 1 ± ± A . Denote the consumers’ utility functions by u A .x A 1 ; x A 2 / and u B .x B 1 ; x B 2 / . Suppose that the firm produces good 2 as an output using good 1 as input according to the production function y 2 D f.y 1 / . (a) (5 points.) Define feasible allocation . (b) (10 points.) Define Pareto efficient allocation . (c) (10 point.) What is the budget constraint of consumer A assuming he takes prices .p 1 ; p 2 / and the firm’s profit ² as given?
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This note was uploaded on 03/01/2012 for the course ECON 121 taught by Professor Samuelson during the Spring '09 term at Yale.

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spring2009_midterm2_makeup - Second Midterm Exam Econ 150b....

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