According to the second welfare theorem
A. equity cannot be analyzed in the Edgeworth box model because it shows only possible trades toward efficiency.
B. the welfare of individuals is not based on material goods.
C. the issues of equity and efficiency are separate in that the system can be on the contract curve but might not be considered equitable.
D. when an allocation is efficient it also achieves equity.
Answer: C
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Scarcity means we must
A) consume less. B) produce less. C) make choices. D) earn more. E) work more.
The Coase Theorem does not imply which of the following?
a. Resources will be allocated efficiently in the absence of transactions costs. b. Resources will move to their highest valued use in there are no transactions costs. c. The initial allocation of property rights does not matter to the parties involved. d. The allocation of resources is independent of the assignment of property rights if transactions costs are zero.