When the Allocation of Two Goods Between Two Individuals Is

question 44

Multiple Choice

When the allocation of two goods between two individuals is efficient:

• A)the utilities of both the individuals from the consumption of these two goods are equal.
• B)both individuals will derive the maximum utility from the consumption of these two goods.
• C)the marginal rates of substitution between two goods for both the consumers are the same.
• D)the market demand curves in all markets are identical.

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Definitions:

Mortgage

A secured loan where property or real estate is used as collateral, with the borrower agreeing to pay back the loan with a predetermined set of payments.

Bankruptcy Petition

A legal document filed by an individual or corporation declaring inability to repay debts, thus seeking relief through bankruptcy court.

Liquidated

The process of converting assets into cash or paying off liabilities in the winding up of a business or partnership.