Consider a competitive market with L goods, N consumers and J firms. In this setting, assume that we find an equilibrium
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Consider a competitive market with L goods, N consumers and J firms. In this setting, assume that we find an equilibrium
Consider a competitive market with L goods, N consumers and Jfirms. In this setting, assume that we find an equilibrium pricevector p and equilibrium allocation (x1, x2 , . . . , xÑ ; Yï‚Y2, ..., y), where x; € R¹ for every consumer i and y; € R¹ forevery firm j. Show that, if we were to scale price vector p to 2p*,where λ>0, then allocation (x₁, x2,..., XN; yi, y2, ..., yj) isstill the equilibrium allocation.