Refer to the Article Summary. The article discusses income inequality, and for some people this means a more equitable distribution of income is needed in the economy. Would an equitable distribution of income necessarily be the most efficient distribution of income?
A) No, it is impossible to have an economically efficient distribution which is also an equitable distribution.
B) No, an economically efficient distribution of income would not necessarily be equitable.
C) Yes, in order for the distribution to be equitable, it must also be efficient.
D) Yes, equitable and efficient are two different words which have the same definition.
B
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Indicate whether the statement is true or false
Refer to Table 2-12. What is Guatemala's opportunity cost of producing one sailboat?
A) 1/6 of a canoe B) 2/3 of a canoe C) 3 canoes D) 6 canoes
If the price of a cup of coffee increases by 50 percent, the quantity demanded decreases by 50 percent. The price elasticity of demand is:
A. elastic. B. inelastic. C. unit elastic. D. zero.
Which of the following characteristics does perfect competition have in common with monopolistic competition?
a. price-taking firms b. homogeneous products c. no barriers to entry d. horizontal demand curve e. neither market advertises