Author Question: Using the government as a means of redistribution generates equity at the cost of efficiency, in ... (Read 28 times)

formula1 · **on:** Jun 29, 2018

Using the government as a means of redistribution generates equity at the cost of efficiency, in part because

A) the process of redistribution uses up some of society's resources.
B) the process of redistribution creates new resources for society.
C) redistribution creates new incentives to work for both rich and poor.
D) redistribution would not take place otherwise.

Question 2

For a natural monopoly, if price is equal to marginal social cost, then

A) the deadweight loss is as large as possible.
B) the firm makes zero economic profit.
C) there is no deadweight loss.
D) there is no deadweight loss and the firm makes a positive economic profit.