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Consider an economy in which George and Harriet consume only ale and bread. George's utility function is UG = aG(bG- 1) where aG and bG are his consumption of ale and bread. Harriet's utility function is UH = ((aH)^(2))(bH- 1) where aH and bH are her consumption of ale and bread. George is endowed with one unit of ale and one unit of bread. Harriet is endowed with two units of bread but no ale. Using aG as an index, find all of the Pareto optimal allocations.
Q. Show factors that govern the Price Elasticity of Demand? a. The number and closeness of the substitutes- The more and the better the substitutes, the grater is the Price Ela
If population growth carry on then there will not be sufficient resources around for everyone this will lead to an event such as famine / war, which will decrease the population.
Critically examine the statement that privatization can always decentralize economic power.
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