W² 40 Hatfield and McCoy hate each other. The only good they both consume is whiskey. Hatfield's utility function is UH = WH-WM and McCoy's utility function is UM = WM-W, where WH is Hatfield's consumption of whisky and WM is McCoy's consumption of whiskey. The sheriff has confiscated a total of 60 litres of whiskey which he could give back to them or throw in the creek. Say that the Sheriff wants them both to be as well off as possible and weighs their "happiness" equally. How much whiskey should the sheriff give to each of them? Should he throw any whiskey in the creek; if so how much?

W² 40 Hatfield and McCoy hate each other. The only good they both consume is whiskey. Hatfield's utility function is UH = WH-WM and McCoy's utility function is UM = WM-W, where WH is Hatfield's consumption of whisky and WM is McCoy's consumption of whiskey. The sheriff has confiscated a total of 60 litres of whiskey which he could give back to them or throw in the creek. Say that the Sheriff wants them both to be as well off as possible and weighs their "happiness" equally. How much whiskey should the sheriff give to each of them? Should he throw any whiskey in the creek; if so how much?

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter6: Consumer Choice And Demand

Section: Chapter Questions

Problem 2.4P

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