The Arrow Impossibility Theorem Explains

question 164

Multiple Choice

The Arrow impossibility theorem explains

• A)why there is no system of voting that will consistently represent the underlying preferences of voters.
• B)why government regulation of private markets will always result in a reduction in economic efficiency in these markets.
• C)why voters are always rationally ignorant.
• D)why it is not possible to provide the economically efficient amount of any public good.

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Definitions:

Accrued Expense

Expenses that have been incurred but not yet paid or recorded through a standard accounting transaction, often recognized at the end of an accounting period.

Electric Bill

The cost incurred for the consumption of electricity by a household, business, or organization.

Paid

The process of disbursing money in exchange for goods or services, or the act of fulfilling an obligation such as a debt.

Adjusted Trial Balance

A list of all accounts and their balances after adjustments have been made for accruals and deferrals.