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    Edgeworth Box problem

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    Suppose that two individuals have the same tastes and the same initial endowments. What can you say about the efficiency of the allocation which corresponds to the initial endowment? By way of explanation, illustrate using an Edgeworth box to show what is going on.

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    With same tastes and initial endowment the allocation will be Pareto Optimal. This can be illustrated using the ...

    Solution Summary

    Edgeworth box problem is depicted.