Social and economic policies often involve a tradeoff between efficiency and equity because
A) the economy can achieve efficient allocation of resources by starting with unequal allocation of resources.
B) economic units who are efficient completely dislike equity.
C) it is not possible to improve efficiency with economic policies.
D) income redistribution often reduces incentives for efficient behaviour of economic units.
E) income redistribution increases incentives for efficient behaviour of economic units.
Correct Answer:
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