Asked by Kennedy Ellison on Jul 12, 2024

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From a point within the utilities possibilities frontier,

A) movement to another point within the frontier can only increase one person's utility, but not both people's utility.
B) it is possible to find another point within the frontier that generates higher utility for both people.
C) it is possible to find another point within the frontier that involves higher output of both goods.
D) any move to another point within the frontier will necessarily decrease someone's utility.

Utilities Possibilities Frontier

A curve that represents the maximum utility levels that can be achieved by an economy given efficient allocation of resources.

Utility

In economics, the total satisfaction received from consuming a good or service.

  • Master the key ideas of welfare economics, including the utility possibilities frontier, and understand how it demonstrates the optimal allocation of resources.
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(T
(K12_HN) Tran Thanh SonJul 18, 2024
Final Answer :
B
Explanation :
The possibilities frontier represents the maximum amount of output of two goods that can be produced with the given resources and technology. If a point within the frontier is chosen, it means that resources are used efficiently to produce the optimal combination of goods. Therefore, it is possible to find another point within the frontier that generates higher utility for both parties by reallocating resources in such a way that produces more of one good without giving up too much of the other good. This would lead to a more preferred point for both parties.