If some gain and some lose as the result of a change, and it can be demonstrated that the value of the gains exceeds the value of the losses, then the change is said to be
A) potentially efficient.
B) inefficient.
C) unequivocally Pareto optimal.
D) technically efficient.

Question

Quizplus · Accepted Answer

This is a description of potential Pareto efficiency, or the Kaldor-Hicks criterion, where a change is considered potentially efficient if the gains from the change can, in theory, compensate the losers and still have some benefits left over. It does not require that compensation actually happens, only that it could.

If Some Gain and Some Lose as the Result of a Change