Once a Point on a Contract Curve Has Been Chosen

question 20

Multiple Choice

Once a point on a contract curve has been chosen,

• A) it is possible to make both individuals better off.
• B) it is possible to make one individual better off only at the expense of the other.
• C) there is no change that would make both individuals worse off.
• D) it is impossible for both individuals to have more of both goods.

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Definitions:

Insurable Interest

A requirement for purchasing insurance, denoting the policyholder must stand to lose financially if the insured event occurs.

Damage

The monetary compensation required by law to be paid to an individual or entity as restitution for harm or injury they have incurred.

Indemnify

To compensate for harm or loss; in legal contexts, often involves a party agreeing to bear any losses or damages incurred by another party.

Third-party Claims

Third-party claims involve demands for compensation or legal action brought by someone who is not a direct party to a contract, usually in liability or insurance cases.