Question: Explain briefly using equations why allocation of resources arising in a general competitive equilibrium is economically efficient?

Explain briefly using equations why allocation of resources arising in a general competitive equilibrium is economically efficient?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Mathematics Questions!

Q:

1.Discuss the difference between a partial equilibrium analysis and a general equilibrium analysis. Illustrate using examples for each. (Hint: I mentioned to you during tutorials that you are to...

Q:

Explain how the conditions of utility maximization, cost minimization, and profit maximization in competitive markets imply that the allocation arising in a general competitive equilibrium is...

Q:

11. Explain how the conditions of utility maximization, cost minimization, and profit maximization in competitive markets imply that the allocation arising in a general competitive equilibrium is...

Q:

Show alll the steps Problem 3. (Technology) Suppose a producer has access to the technology given by the Cobb-Douglass production function y = 3K1 14. a) What can you say about the returns to scale...

Q:

The process by which price and output are determined in the real world is strongly affected by the structure of the market. A market consists of all the actual and potential buyers and sellers of a...

Q:

annssw Consider a two person exchange economy with preferences for person i {1,2} being u(c) and endowments being w, where c = (cc) and the endowment for person 1 is wi (w1,0) with w > 0, and for...

Q:

Consider a two-good, two-consumer pure exchange economy of the following data: U A(x A 1 , xA 2 ) = (x A 1 ) a (x A 2 ) 1?a , wA = (1, 0) U B(x B 1 , xB 2 ) = (x B 1 ) b (x B 2 ) 1?b , wB = (0, 2)...

Q:

1. Explain what means that a resource allocation is efficient and describe the (marginal) conditions that such allocation will satisfy. Also define the concept of perfectly competitive equilibrium...

Q:

man 34 After experiencing a recession for the past two years, the residents of Albernia were looking forward to a decrease in the unemployment rate. Yet after six months of strong positive economic...

Q:

Exchange and Efficiency 2 General equilibrium analysis In our lectures, we discussed the relationship between competitive equilibrium out- come and Pareto efficiency. In what follows, let's explore...

Q:

Angel Blythe, the bookkeeper of Aster Co., also collects the payment of invoices by customers. Angel noticed that Rume Co. paid the April 10 invoice twice. Angel, who is in need of extra cash, does...

Q:

Discuss quick response strategies while fulfilling the customer orders. What happened to the service level during the covid 19 pandemic? and how does ditribution help in achiveing the customers...

Q:

The holding period return is not as accurate a measure of return as the IRR. TrueFalse

Q:

On 1 March 2007 DB Limited issued R560 000 15% debentures at R98. The debentures were to be redeemed at par in four equal annual payments starting 28 February 2010. Required: Journalise the above...