Consider a pure exchange economy with two consumer and two commodities. Consumer A's endowment is (10, 5) and consumer B's endowment is (10, 5) . Consumer A's utility function is uᴀ(x₁, x₂) = min{x₁, 4x₂} and consumer B's utility function is uʙ(x₁, x₂) = x₁ + x₂.
In this economy, which of the following is TRUE?
A. By using the existence of an equilibrium result in the videos, we know that this economy has an equilibrium
B. We cannot use the existence of an equilibrium result in the videos since at least one consumer has non - convex preferences
C. We cannot use the existence of an equilibrium result in the videos since at least one consumer has non - monotone preferences