Jack Spratt's utility function is U(F, L) L.His wife's utility function is U(F, L) F.If Jack's initial endowment is 100 units of F and 50 units of L and if Jack's wife's initial endowment is 60 units of F and 100 units of L, then in an Edgeworth box for Jack and his wife, an allocation of F and L will be Pareto optimal only if it is at a corner of the box.

Utility Function

A mathematical representation of how different combinations of goods or services produce levels of happiness or satisfaction for an individual or entity.

Pareto Optimal

A state of allocation of resources in which it is impossible to make any individual better off without making at least one individual worse off, indicating an efficient distribution of goods and resources.

Endowment

The total resources available to an individual or institution, including assets, capabilities, and financial means.