1. [5] Answer TRUE or FALSE, along with an explanation. (a) [1] The levels of poverty and inequality observed in the real world contradict the Welfare Theorems for competitive markets. (b) [1] Markets are the only exchange mechanisms that yield Pareto-efficient allocations of goods. (c) [1] Taxes make markets less efficient. (d) [1] Consider a production economy in which firm a is twice as productive as firm b, that is, firm b has production function f(z) and firm a has production function 2/ (2). Then firm b must shut down in all competitive equilibria. (e) [1] Private health insurance is expensive because markets should not be used to deliver health care