Suppose this person is relatively happy with the initial

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Suppose that a person has initial amounts of the two goods that provide utility to him or her. These initial amounts are given by  width=.

a. Graph these initial amounts on this person’s indifference curve map.

b. If this person can trade x for y (or vice versa) with other people, what kinds of trades would he or she voluntarily make? What kinds would not be made? How do these trades relate to this person’s MRS at the point width=

c. Suppose this person is relatively happy with the initial amounts in his or her possession and will only consider trades that increase utility by at least amount k. How would you illustrate this on the indifference curve map?

Reference no: EM13340068

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