Exhibit 7-13 -Informational Efficiency

question 116

Multiple Choice

Exhibit 7-13
-Informational efficiency

• A)can be achieved only when everyone knows everyone else's marginal benefits and marginal costs.
• B)occurs when buyers and sellers can communicate their respective marginal benefits and marginal costs to each other.
• C)is easily proven mathematically to occur in competitive markets, much like Pareto efficiency has been proven to occur in such markets.
• D)occurs in a centralized allocation system like that of the former Soviet Union.
• E)occurs when it is costless to send messages.

---

Definitions:

Month-end Contributions

Payments or deposits made towards an investment or savings plan at the end of each month.

Compounded Monthly

Interest that is calculated and added to the principal balance once a month.

Family Support

Financial contributions, typically governed by legal or agreement, made to support the wellbeing and upkeep of family members.

Economic Value

The significance of a good or service for individuals or society in terms of its ability to satisfy needs or wants.