3. Robinson starts out with 10 lobsters and 10 coconuts. Friday starts out with 10...
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3. Robinson starts out with 10 lobsters and 10 coconuts. Friday starts out with 10 lobsters and 10 coconuts. Their utility functions are both U=min{ lobster, coconut }.30pts a. Draw the Edgeworth Box, paying attention to the dimensions of the box. Put Robinson in the southwest and Friday in the northeast. Label the point illustrating the endowment. b. What kind of preferences do they have over lobsters and coconuts? c. Draw a line representing the contract curve (set of all Pareto optimal points). d. Is there a trade that would represent a Pareto improvement over the initial endowment
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