When two people are on the contract curve,the allocation of goods

Question

Quizplus · Accepted Answer

When two people are on the contract curve, it means that they have reached an agreement where both are better off than before. Therefore, any attempt to improve the allocation of goods would make at least one person worse off. This is the definition of pareto efficiency, and it is the best outcome that can be achieved when two individuals are on the contract curve. Therefore, all of the options (A, B, and C) are correct.

When Two People Are on the Contract Curve,the Allocation of Goods