In the Edgeworth box diagram if the initial allocation of consumer goods is off the contract curve then we can be sure that
A) Both parties can be made better off
B) Trade will occur if allowed and transactions costs are high
C) The initial allocation is unfair
D) The initial allocation is irrelevant
Correct Answer:
Verified
Q1: According to the exchange model of production,
Q3: In the Edgeworth diagram model a doubling
Q4: The consumption contract curve
A)Is always a straight
Q5: According to the text, if a policy
Q6: In competitive equilibrium
A)The MRS of all consumers
Q7: An allocation of resources is Pareto optimal
Q8: If my MRS between two consumer goods
Q9: If one is inside the production possibilities
Q10: In equilibrium with an Edgeworth production box
A)MPK/MPL
Q11: A Pareto preferred transaction is one where
A)The
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