The Second Fundamental Theorem of Welfare Economics requires
A)that indifference curves be convex to the origin.
B)that isoquants be concave to the origin.
C)that there are no set prices for Pareto efficient allocations.
D)that production be twice as large as consumption.
E)all of the above.

Question

Quizplus · Accepted Answer

The Second Fundamental Theorem of Welfare Economics requires that indifference curves be convex to the origin, which ensures that consumers' preferences are well-behaved and that a competitive market can achieve any Pareto efficient allocation through appropriate redistribution of initial endowments.

The Second Fundamental Theorem of Welfare Economics Requires