Recall the split dollar example discussed in class, in that example there are tw

Question

Recall the split dollar example discussed in class, in that example there are two individuals (A and B) and the set of possible allocation is

X= {(xA,xB) : xA >0, xB>0, xA+xB<100}

i) Is a (60,30) split (A gets 60, B gets 30) Pareto optimal?
ii) Is a (20,80) split Pareto optimal?
iii) Does (20,80) Pareto-dominate (60,30)?

Assume now that the dollar must be split among 3 people A, B and C.

Y= {(xA,xB,xC) : xA >0, xB>0, xC>0, xA+xB+xC<100}

An example of Pareto optimal allocation is now (20,30,50).

iv) Give 2 other examples of Pareto optimal allocations in this three person divide the dollar game.

v) Give an example of 2 allocations in set Y(i.e., a three way split of the dollar) such that the first Pareto dominates the second.

Explanation / Answer

aliendro mascapw scdsa

Related Questions

Navigate

• Browse (All)
• Browse R
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.