Why Does Economic Efficiency Not Always Result in Fair and Equal

question 196

Multiple Choice

Why does economic efficiency not always result in fair and equal treatment?

• A) Efficiency demands cost-minimization, which may cause the nonproduction of expensive items or adjustments designed to ensure that disadvantaged members of society are catered for.
• B) Market efficiency requires that only profitable goods be produced in order to maximize the return from using scarce resources, and some goods for the disadvantaged may not always yield profits.
• C) Market efficiency does not always allow firms to hire disadvantaged members of society so labor and governments sometimes have to step in to demand hiring of some of these individuals.
• D) All of these explanations are correct.

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