When government policies are being designed:
A) there is usually a tradeoff between equity and efficiency.
B) equity and efficiency goals are usually independent of each other.
C) equity can usually be achieved without an efficiency loss.
D) increasing efficiency usually results in more equity.

Question

Quizplus · Accepted Answer

Government policies often involve a tradeoff between equity (fair distribution of resources) and efficiency (maximizing total output or welfare). Improving equity may require redistributive measures that can reduce incentives for production, thus affecting efficiency.

When Government Policies Are Being Designed