Multiple Choice
If the initial distribution of labor and capital is Pareto optimal, which of the following statements is TRUE?
A) It is possible to reallocate labor and capital across industries so as to increase the production of one good without decreasing the production of another good.
B) It is possible to reallocate labor and capital across industries so as to increase the production of one good, but only by reducing the production of another good.
C) It is possible to reallocate labor and capital across industries so as to increase the production of every good.
D) none of the above
Correct Answer:
Verified
Correct Answer:
Verified
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