Which of the following statements is TRUE?
A) A government policy that eliminates a market failure, but only some people gain while others are kept the same, is not a Pareto improvement.
B) A government policy that eliminates a market failure, but only some people gain while others are kept the same, is a Pareto improvement.
C) A government policy that eliminates a market failure and some people gain and some lose only a little, is a Pareto improvement.
D) A government policy that generates a Pareto improvement eliminates all deadweight loss.
Correct Answer:
Verified
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