If Everyone's Utility Is Given Equal Weight and a Change

question 84

Multiple Choice

If everyone's utility is given equal weight and a change in resource allocation results in one person's gain exceeding another person's loss,we can say that the new allocation

• A) is Pareto superior to the original one.
• B) increases social welfare.
• C) decreases social welfare.
• D) is efficient.

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Definitions:

Carrying Value

The book value of an asset as shown on the balance sheet, calculated as the original cost minus accumulated depreciation, impairment charges, or amortization.

Selling Price

The amount of money a buyer pays to purchase a product or service from a seller.

Restructuring Gain

Income recognized from the process of reorganizing the legal, ownership, operational, or other structures of a company to make it more profitable or organized.

Stamping Machine

A machine used in the manufacturing process to imprint or shape items with specific designs or patterns.