Andrew and Sarah are two traders in a pure exchange economy with two goods, Bikes and TVs. Suppose Andrew has preferences given by: U(B,T) = BT where B is the number of bikes and T is the number of TVs
Sarah only derives utility from TV, so her utility function can be given by: V(B,T) = T Describe the contract curve.
The contract curve will be points where Sarah consumes zero Bikes. Notice that any bundle in which Sarah's consumption of TVs is positive is Pareto dominated by the same bundle but with the quantity of Bikes reduced to zero.
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As long as the supply curve for a good is upward sloping and the demand curve is downward sloping, a sales tax imposed on sellers shifts the supply curve
A) leftward and definitely raises the equilibrium price. B) leftward and possibly raises the equilibrium price. C) rightward and possibly increases the equilibrium quantity. D) rightward and definitely decreases the equilibrium quantity.
With regard to agricultural productivity (grain crops) in the post-Civil War period (1870–1910),
(a) output per acre went up significantly. (b) output per man-hour went up significantly. (c) output per unit of energy input went up significantly. (d) all of the above occurred.