If there is no other allocation that will allow the economy to produce more of one good without producing less of another good, then a given allocation

Question

Quizplus · Accepted Answer

If there is no other allocation that produces more of one good without producing less of another good, then the given allocation is considered Pareto efficient. This means that it is impossible to make one individual better off without making another individual worse off. Therefore, choice B is the correct answer. Choice A, producing extra-normal profits, is not necessarily true with a Pareto efficient allocation.

If There Is No Other Allocation That Will Allow the Economy