An Economy Produces Outputs X and Y Using Inputs L

question 5

Multiple Choice

An economy produces outputs X and Y using inputs L and K. Which of the following is NOT required for economic efficiency?

• A) MRTS_LK = MRS_XY for all producers and consumers.
• B) MRT_XY = MRS_XY for all producers and consumers.
• C) MRS_XY is equal for all consumers.
• D) MRTS_LK is equal for all producers.
• E) None of the above. All of these are required for economic efficiency.