Question 1
Suppose a policy change generates $200,000 of benefits for low-income families and $175,000 of costs for high-income and middle-class families. We can best describe the change as
◦ inefficient.
◦ Pareto efficient.
◦ potentially efficient.
◦ equitable.
Question 2
Voluntary exchange is a change that makes
◦ some people better off and some people worse off.
◦ nobody better off and nobody worse off.
◦ everyone better off and nobody worse off.
◦ some people better off and nobody worse off.