The above figure depicts the Edgeworth box for two individuals, Al and Bruce. If the endowment is at point a, and Bruce has no ability to bargain, the final allocation will be at point

Suppose the money demand of individuals and firms depends on what they perceive to be the probabilities that the economy will expand or contract over the following six months

Suppose their money demand is given by the equation L = 0.5Y - 100i + 20z, where z is the probability that the economy is expanding six months in the future. If z = 1, the economy will certainly be in recovery, if z = 0, the economy will certainly be in recession, and for z between 0 and 1 there is some uncertainty about the future state of the economy. Use a classical (RBC) model of the economy. If the Fed moves the money supply to target the price level, how does the money supply relate to the expected future state of the economy? Is this an example of reverse causation?

Equality means distributing society's resources in the most efficient manner

a. True b. False Indicate whether the statement is true or false