Assume the Nozick Rules Are Being Followed in the Economy

question 108

Multiple Choice

Assume the Nozick rules are being followed in the economy so that the distribution of income is fair.What must be true for this to create an efficient allocation of resources?

• A) All people are earning equal incomes.
• B) There are no public goods, monopolies, high transactions costs, or external costs and benefits.
• C) The costs of administering redistribution equals the benefits the poor receive.
• D) The government must redistribute income in a fashion that minimizes the "big tradeoff."
• E) The government must allocate resources using a command mechanism.

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Definitions:

Retina

The light-sensitive layer of tissue at the back of the inner eye, which converts light images into electrical signals sent to the brain.

Pinna

The visible part of the ear that is outside the head, responsible for collecting sound waves and directing them into the ear canal.

Eardrum

A thin, cone-shaped membrane that separates the external ear from the middle ear, and vibrates in response to sound waves.

Taste Preferences

Individual differences in liking or disliking certain flavors and foods.