The second fundamental theorem of welfare economics states that
A) under certain conditions, a competitive equilibrium is Pareto optimal.
B) a competitive equilibrium is always Pareto optimal.
C) under certain conditions, a Pareto optimum is a competitive equilibrium.
D) a Pareto optimum is always a competitive equilibrium.
E) a Pareto optimum does not have to be a competitive equilibrium.
Correct Answer:
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Q16: Examples of exogenous variables include
A) real wages,
Q17: Fiscal policy refers to a government's choices
Q18: In a one-period economic model,the government budget
Q19: In an economic model,government spending is assumed
Q20: In an economic model,an endogenous variable is
A)
Q22: An example of a negative externality is
A)
Q23: A competitive equilibrium has the following property:
A)
Q24: The marginal rate of transformation is
A) the
Q25: The real wage is determined by
A) the
Q26: The first fundamental theorem of welfare economics
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