Question: Consider a two-period resource allocation model where the efficient allocation implies undiscounted total surplus of $75 and $45 in the first and second periods, respectively.

Consider a two-period resource allocation model where the efficient allocation implies undiscounted total surplus of $75 and $45 in the first and second periods, respectively. Assume the rate of return on investment is 50 percent. The smallest possible intergeneration transfer that will make the efficient resource allocation sustainable is:

Question 4Select one:

a.$30.

b.$12.

c.$15.

d.$45.

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