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Unformatted text preview: (a) Show that if person 1 has some bananas and person 2 has some apples, the resulting allocation must be inefficient. (b) There are three Pareto efficient allocations in this question. Can you find all of them? 3. Was NAFTA (North American Free Trade Agreement, a free trade agreement among Canada, the United States, and Mexico) Pareto improving? If not, why would governments pursue it? 4. Explain why Pareto efficiency is a weak evaluation criterion. 5. Why do people demand government goods and services? How much government is enough?...
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This note was uploaded on 04/15/2010 for the course ECON 290 taught by Professor J liu during the Spring '06 term at Simon Fraser.
- Spring '06
- J Liu