Chapter 4 Market Outcomes and Tax Incidence e Pages 116118 4

Chapter 4: Market Outcomes and Tax Incidence e Pages) 116-118 4.2. When is a market efficient? Determine whether each of the following actions is based on equity or efficiency. Match the correct term with each action Drag each item on the left to its motching item on the right. Note that every item may not have a match, while some items may have more than one match. A university adopts a policy to make sure that there are no unused classrooms during the school day. A doughnut shop offers a discount on all doughnuts purchased after 5 p.m. to reduce the number of doughnuts the shop must discard at the end of the day. efficiency equity A children\'s baseball league makes a rule that all team members must receive some amount of playing time in every game.

Solution

Adopting a policy that to make sure that there is no unused classroom during the school days show the efficiency. when no classroom is unused it means utilization of resources is maximum, when the utility is maximized it shows the efficiency.  

other two are the example of equity. in both examples, it provides some benefits to others with equal opportunity.