Two farmers Anil and Bala are each deciding how to deal with pest insects that destroy the crops they cultivate intheir adjacent fields. They have the choice of using either Integrated Pest Control (IPC) or Terminator (T). Thepayoffs for their choices in terms of tonnes of crop are shown in the diagram. Which of the following statements isincorrect?5Bala's payoffلنا21O0Select one:•1T.T23Anil's payoff4T.I5LI-Both use Integrated Pest Control (IPC)T.T-Both use TerminatorT, I-Anil uses Terminator, Bala uses IPCLT-Anil uses IPC Bala uses Terminatora. Pareto-efficiency does not necessarily mean that we should approve of it.b. (1, 1) Pareto-dominates (T, T).c. (1, 1) and (I, T) are Pareto-efficient.d. If Anil and Bala moving from (T, T) to (1, 1), there is Pareto-improvement as both farmers are better off.e. Pareto criterion tells us that (1, 1) is the best outcome as it is Pareto-efficient.

Pareto efficiency is a situation when no one can be made better off without making at least one…

Two farmers Anil and Bala are each deciding how to deal with pest insects that destroy the their adjacent fields. They have the choice of using either Integrated Pest Control (IPC) or Terminator (T). The payoffs for their choices in terms of tonnes of crop are shown in the diagram. Which of the following statements incorrect? Bala's payoff 4 3 2 1 a LT P TH T.T 2 3 Anil's payoff 4 T.I LI-Both use Integrated Pest Control (IPC) T.T-Both use Terminator TI-Anil uses Terminator, Bala uses IPC LT-Anil uses IPC, Bala uses Terminator Select one: • a. Pareto-efficiency does not necessarily mean that we should approve of it. b. (1, 1) Pareto-dominates (T, T). c. (1, 1) and (I, T) are Pareto-efficient. d. If Anil and Bala moving from (T, T) to (1, 1), there is Pareto-improvement as both farmers are better off. e. Pareto criterion tells us that (1, 1) is the best outcome as it is Pareto-efficient.

Two farmers Anil and Bala are each deciding how to deal with pest insects that destroy the their adjacent fields. They have the choice of using either Integrated Pest Control (IPC) or Terminator (T). The payoffs for their choices in terms of tonnes of crop are shown in the diagram. Which of the following statements incorrect? Bala's payoff 4 3 2 1 a LT P TH T.T 2 3 Anil's payoff 4 T.I LI-Both use Integrated Pest Control (IPC) T.T-Both use Terminator TI-Anil uses Terminator, Bala uses IPC LT-Anil uses IPC, Bala uses Terminator Select one: • a. Pareto-efficiency does not necessarily mean that we should approve of it. b. (1, 1) Pareto-dominates (T, T). c. (1, 1) and (I, T) are Pareto-efficient. d. If Anil and Bala moving from (T, T) to (1, 1), there is Pareto-improvement as both farmers are better off. e. Pareto criterion tells us that (1, 1) is the best outcome as it is Pareto-efficient.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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