When comparing point A, which lies within a utilities possibilities frontier, with point B, which lies on the same utilities possibilities frontier,
A) A may be more efficient than B.
B) A is necessarily more equitable than B.
C) B may be more equitable than A.
D) B is necessarily more equitable than A.

Question

Quizplus · Accepted Answer

Points on the utilities possibilities frontier represent efficient allocations, whereas points within the frontier are not efficient. However, equity is a separate consideration from efficiency. Point B, being on the frontier, is efficient, but whether it is more equitable than point A depends on the distribution of resources, not their total amount. Therefore, point B may be more equitable than point A, but it is not a necessity.

When Comparing Point A, Which Lies Within a Utilities Possibilities