ECON 111 Exam Solutions Fall 2018: Natural Capital, Pareto Efficiency, Imperfect Competition
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2: some inequality of economic outcomes is essential for the creation of wealth because, some people are more deserving of wealth than others, people need incentives to undertake effort and risk. 3 trade makes countries wealthier: trade allows the exploitation of economies of scale because. A: consumers have greater access to goods and services. D. large global firms are more able to produce at volumes where unit costs are lower trade rules provide enhanced protection of intellectual property rights and thereby encourage investment in larger scale production technologies. Answer key: c, b, a, a, b, d, c, d, c, c, d, a, b, b, b, c, a, b, c, c. Pareto improvement usually refers to the allocation of resources: the correct answer is c. Means that unit production costs are lower when different goods are produced by the same firm.
