Author Question: An economy produces outputs X and Y using inputs L and K. Which of the following is NOT required for ... (Read 77 times)

ssal · **on:** Jul 1, 2018

An economy produces outputs X and Y using inputs L and K. Which of the following is NOT required for economic efficiency?

A) MRTSLK = MRSXY for all producers and consumers.
B) MRTXY = MRSXY for all producers and consumers.
C) MRSXY is equal for all consumers.
D) MRTSLK is equal for all producers.
E) None of the above. All of these are required for economic efficiency.

Question 2

Used cars sell for much less than new cars because

A) of imperfect competition in the automobile industry.
B) buyers know much more about the quality of used cars than sellers do.
C) sellers know much more about the quality of used cars than buyers do.
D) physical depreciation of used cars is very high.
E) of licensing arrangements by the government.