-Use the Above Figure

question 34

Multiple Choice

-Use the above figure. Refer to the above diagram where curves (a) through (d) are for four different countries. Income is most unequally distributed in

• A) Country A.
• B) Country B.
• C) Country C.
• D) Country D.

---

Definitions:

Contract Curve

In an Edgeworth Box diagram, the locus of points representing the set of mutually beneficial allocations between two parties.

Edgeworth Box

A diagram used in microeconomics to show the distribution of resources between two consumers on a two-good world, demonstrating how trade can lead to Pareto improvements.

Utility Function

A mathematical representation that ranks individuals' preferences for bundles of goods or services, indicating levels of satisfaction.

Competitive Equilibrium

A situation in a market where the demand for goods equals the supply of goods, resulting in an equilibrium price and quantity that clears the market.