DSE 2007 Q.no.27 & 31...pls help

[Abhyudaya]

Hello to everyone....

Can anyone guide me through Q. no 27 & 31....
telling me d method wud suffice n detailed exlanation will b appreciated....

Showing me d way will help me solve all related questions..... :)

[Abhyudaya]

 I forgot to give link to DSE 2007 paper.....



http://economicsentrance.weebly.com/uploads/1/1/0/5/1105777/30_jun_2007_option_a.pdf

[duck]

Hi.. :)

27) Its given that Agent 1 is a first mover. So, just maximise his utility subject to the constraint given. You'll get his demand. Now, whatever left in the economy will be consumed by Agent 2 as his utility is increasing in both x and y. So, no matter what he would like to consume whatever is available.

31) None of the four options is correct.
Given: P_e = P
Solve the two equations, you'll get μ=λ/α(1+λ).

[Abhyudaya]

Thanks duck for ur answers.... you are a blessing in disguise.... :)