Given an Initial Allocation of Resources That Is Off the Consumption

question 27

Multiple Choice

Given an initial allocation of resources that is off the consumption contract curve, in a perfect market environment without externalities and imperfect information,

• A)one can end up at any point on the contract curve.
• B)one can end up at only one spot on the contract curve.
• C)both indifference curves could move to a higher level of utility.
• D)only one of the indifference curves could move to a higher level of utility.

---

Definitions:

Net Cash

Net cash refers to the amount of cash that remains after subtracting a company's total cash outflows from its total cash inflows, indicating the company's liquidity position.

Income Taxes

Charges imposed by the authorities on earnings from companies and individuals within their territory.

Cash Receipts

The collection of money, including coins, currency, checks, and electronic payments, received by a business during a given period.