dse 2009

[hs]

why cant ans to q 50 be option C

[mrittik]

I hav also got this answer...

[neha:)]

I have the same doubt!

[Dreyfus]

For agent A the given utility function can be rewritten as xa + 2ya
Since Muxa =1 and Muya = 2 and for agent b Marginal utility from both the goods is 1
Therefore A will maximize his utility (given the total endowments and B's utility ) by consuming only good y and won't consume good x but for agent B there is no such restriction as he is indifferent b/w consuming either x or y or both!
Therefore contract curve will be A's y-axis and B's x axis

[SoniaKapoor]

Hi Drefus. Could you please plot the diagram. It will really be helpful to me Thanks

[Akshay Jain]

Ques 49

[Akshay Jain]

[SoniaKapoor]

Thank Yoy akshay..

[Ridhika]

Akshay please explain questions 17 and 56 from the same paper as well?

I think I'm missing the intuition behind them..

[phelps.phan]

I have the same doubt.
Qn 17: As expected inflation increases, real interest rate decreases (r=i-inf). This increases investment, which increases output. But this further shifts IS to right and increases interest rate. The movement in income is pretty clear. But I think real interest rate is ambigious. Pls help!

[Akshay Jain]

Ques 17