If the initial allocation of goods is not efficient, consumers will: be required to consume somewhere along their contract curve. buy and sell goods at market prices until the marginal rate of substitution is equalized across all consumers. change their tastes and preferences via their utility function to match the market's marginal rate of substitution. not be able to trade goods and achieve Pareto efficiency.

If the initial allocation of goods is not efficient, consumers will: be required to consume somewhere along their contract curve. buy and sell goods at market prices until the marginal rate of substitution is equalized across all consumers. change their tastes and preferences via their utility function to match the market's marginal rate of substitution. not be able to trade goods and achieve Pareto efficiency.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Consumer Choice Theory

Section: Chapter Questions

Problem 5SQ

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Question

If the initial allocation of goods is not efficient, consumers will:
be required to consume somewhere along their contract curve.
buy and sell goods at market prices until the marginal rate of substitution is equalized across all consumers.
change their tastes and preferences via their utility function to match the market's marginal rate of substitution.
not be able to trade goods and achieve Pareto efficiency.

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