5. (b) Are the following statements true or false? Justify your answer (simply saying true orfalse will carry no credit).i) "A labor market dominated by a single buyer achieves Pareto efficiency if the buyeroperates as a perfectly discriminating monopolist".ii) "A cake is divided between two individuals; Pareto optimality requires that theyreceive equal shares".

Answered: 5. (b) Are the following statements…

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

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5. (b) Are the following statements true or false? Justify your answer (simply saying true or
false will carry no credit).
i) "A labor market dominated by a single buyer achieves Pareto efficiency if the buyer
operates as a perfectly discriminating monopolist".
ii) "A cake is divided between two individuals; Pareto optimality requires that they
receive equal shares".

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Step 1

Meaning of Monopoly:

The term monopoly refers to the situation under which there is only an individual seller producing in the whole market, as there is only one seller in the market, thus the market prices are fully and wholly controlled by that seller, thus refers to as the monopoly market.

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