In the Edgeworth Box, We Can Set One Price to 1

question 3

True/False

In the Edgeworth Box, we can set one price to 1 and only need to solve for the other price because only relative prices matter for individual choice when income is drawn from endowments.

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Definitions:

Overgeneralization

The application of a rule or conclusion to more instances than is justified, often leading to mistaken beliefs or misjudgments.

Traditional Thinking

A mindset adhering to established practices, beliefs, or methods, often resistant to change or innovation.

Casual Observation

An informal or unstructured method of noticing and recording events or behaviors without systematic analysis.

Unscientific Thinking

Processes of thought that do not adhere to the established or accepted frameworks and methodologies of the scientific community, often lacking empirical evidence.