(solution) A consumer views two goods as perfect substitutes. a. Sketch the indifference curves of the…

(solution) A consumer views two goods as perfect substitutes. a. Sketch the indifference curves of the…

A consumer views two goods as perfect substitutes. a. Sketch the indifference curves of the consumer. b. If an economy is composed of two consumers with these preferences, demonstrate that any allocation is Pareto-ancient. c. If an economy has one consumer who views its two goods as perfect substitutes and a second that considers each unit of good 1 to be worth 2 units of good 2, find the Paretoecient allocations.