In competitive equilibrium
A)the MRS of all consumers varies if preferences vary.
B)the MRT of all producers varies depending on the production function of the firm.
C)it is impossible to make anyone better off without making someone else worse off.
D)All of these are true

Question

Quizplus · Accepted Answer

Competitive equilibrium is a state of economic balance in which supply and demand are equal and stable. In this state, any change that benefits one consumer or producer necessarily disfavors others since the allocation of resources is already at its most efficient point. Thus, it is impossible to make anyone better off without making someone else worse off. The other options, A and B, are not necessarily true in a competitive equilibrium as they depend on individual preferences and production functions, respectively.

In Competitive Equilibrium