Absent any violations of the first welfare theorem, the competitive equilibrium is efficient.
Answer the following statement true (T) or false (F)
True
Rationale: That is in fact the first welfare theorem -- absent any of the distortions from violations of the underlying conditions, markets are efficient.
You might also like to view...
Joe walks into Best Buy prepared to spend no more than $500 cash on a new computer, but the price turns out to be $600. Joe is told if he finances it on a Best Buy credit card, it will cost $600, but he will get a $25 gift card free with the computer. Joe opts to open the credit card and puts the full $600 on the account. According to economic theory, Joe's decision is:
A. irrational. B. rational. C. budget-conscious. D. optimal.
One of the remedies that has been used in the case of antitrust violations is the award of treble damages to the party that has been harmed
a. True b. False
An economic policy initiative results in the AD curve shifting to the right. As a result,
A) the price level will rise. B) the price level will stay constant. C) the price level will fall. D) Real GDP will rise in the short run. E) a and d
A cost that expires without producing any revenue benefit is known as a(n) _____.
a. profit b. expense c. surplus d. loss