Anil and Bala have the choice of using either Integrated Pest Control (IPC) or Terminator (T) to solve the problem of pest insects. The table below shows their payoffs depending on their choice. The following diagram shows these possible outcomes on a graph. Based on the information above, read the following statements and select the correct one.
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Question

Anil and Bala have the choice of using either Integrated Pest Control (IPC) or Terminator (T) to solve the problem of pest insects. The table below shows their payoffs depending on their choice. The following diagram shows these possible outcomes on a graph. Based on the information above, read the following statements and select the correct one.

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Accepted Answer

(T, T) is the only Pareto inefficient outcome.

Answer

Anil and Bala will both be happy to move from the Pareto efficient (I, T) to the ‘fairer’ Pareto efficient outcome (I, I).

Answer

(T, I) Pareto-dominates (T, T).

Answer

(I, I) is the unique Pareto efficient outcome.

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Anil and Bala have the choice of using either Integrated Pest Control (IPC) or T...

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