According to the General Equilibrium Model an economically efficient allocation of resources:
A)Is also a "fair" allocation of resources
B)Interpersonal comparisons of utility are both important and useful
C)Is that where no welfare-improving trades can be made
D)Can only be achieved with government intervention

Question

Quizplus · Accepted Answer

In the General Equilibrium Model, an economically efficient allocation of resources is achieved when no further welfare-improving trades can be made. This means that the allocation is Pareto optimal, where no one can be made better off without making someone else worse off. This does not necessarily mean that the allocation is "fair" or takes into account interpersonal comparisons of utility. It also does not imply that government intervention is necessary for achieving efficiency.

According to the General Equilibrium Model an Economically Efficient Allocation