What specific numbers might alessandra have proposed for px

Assignment Help Business Economics

Reference no: EM133401523

Case Study: You are the benevolent dictator of Sbarroland, an Edgeworth economy of two people-Alessandra and Bruno-and two goods-pizzas (x) and breadsticks (y). The economy has a total of 20 pizzas and a total of 16 breadsticks.
The initial endowment is as follows. Alessandra was born owning 4 pizzas, and she was born owning 13 breadsticks. Bruno was born owning the other 16 pizzas and 3 breadsticks. In Edgeworth-style notation, the initial endowment is therefore

(4,13,16,3).

Alessandra proposes that the two people trade according to a specific pair of prices, where px is the dollar price of a pizza, and py is the dollar price of a breadstick. Given the specific prices that Alessandra has proposed, Bruno calculates that he could afford to turn his initial endowment of 16 pizzas and 3 breadsticks into a final allocation of 13 pizzas and 12 breadsticks.

Question: Given that Bruno has done his calculations correctly, what specific numbers might Alessandra have proposed for px and py? (Note: There are multiple possible correct answers.) Explain.

Reference no: EM133401523

Questions Cloud

Identify and explain two factors that have caused a shift : Identify and explain two factors that have caused a shift in the demand curve. Make a graph that Illustrate the impact on the market using supply and demand

Discuss your career path and how you plan to get a job : Is there a degree or certificate available at San Joaquin Delta College, Stockton Ca or another JC. Explore 3 schools that offer your degree at the Bachelor

Explain how law enforcement officers acquire the ethics : Explain how law enforcement officers acquire the ethics that they use to guide them on a daily basis. Discuss the components/phases in each perspective.

What strategies do you think would be most effective : What strategies do you think would be most effective in improving relationships between the community and local police

What specific numbers might alessandra have proposed for px : what specific numbers might Alessandra have proposed for px and py? (Note: There are multiple possible correct answers.) Explain.

How do democracies balance the tension : How do democracies balance the tension between limited and effective government? Provide a couple of examples of constitutional designs and evaluate

Talk about class of drug and mechanism of action : For each drug, talk about the class of drug, mechanism of action, pharmacokinetics, contraindications, most common side effects, drug-drug interactions,

What is the entire order of succession : What is the entire order of succession to the Presidency if he or she should die? List all 18 officials. Names of individuals are not required. Start by looking

What could be the outcome if laws are easily overturned : Once a criminal law is passed, should it be difficult to overturn it? Why or why not? What could be the outcome if laws are easily overturned and or abolished?

User Account

All Pages