If the Initial Distribution of Labor and Capital Is Pareto

question 17

Multiple Choice

If the initial distribution of labor and capital is Pareto optimal, which of the following statements is TRUE?

• A) It is possible to reallocate labor and capital across industries so as to increase the production of one good without decreasing the production of another good.
• B) It is possible to reallocate labor and capital across industries so as to increase the production of one good, but only by reducing the production of another good.
• C) It is possible to reallocate labor and capital across industries so as to increase the production of every good.
• D) none of the above

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Definitions:

Measles

A highly contagious viral disease that causes fever, cough, and characteristic red rash, primarily affecting children.

Mumps

An infectious viral disease characterized by swelling of the salivary glands, often accompanied by fever and sore throat.

Parotid Glands

Salivary glands located on either side of the mouth and in front of both ears, responsible for producing saliva to facilitate digestion.

Contagious Febrile Disease

Infectious disease characterized by fever and can spread from person to person.