Explaining first theorem of welfare economics

Question

Part I:  True/False Statements

Instructions:  Answer either True or False after each of the following statements to indicate whether you believe it to be correct or incorrect.

Question 1:

Our society generally places little emphasis on economic efficiency as an allocation criterion.

True or False:

Question 2:

Alternative efficient allocations have the same total levels and distributions of wealth.

True or False:

Question 3:

“Economic efficiency” does not address “fairness.”

True or False:

Question 4:

The three assumptions of perfect competition imply / eliminates the existence of heterogeneous commodities, which would potentially trade at different prices that reflect different types or qualities

True or False:

Question 5:

The first theorem of welfare economics states that all markets achieve economically efficient resource allocations.

True or False:

Question 6:

The transferability attribute of efficient property rights requires that property rights are secure from encroachment by others

True or False:

Question 7:

An efficient property rights structure is necessary to achieve efficient resource allocation through market trades.

True or False:

Question 8:

The economic efficiency criterion discriminates between alternative efficient allocations.

True or False:

Question 9:

The First Theorem of Economic Welfare states that perfectly competitive markets achieve economically efficient resource allocations.

True or False:

Question 10:

Given no governmental intervention, a negative externality in automobile production implies the price of automobiles is too high.

True or False:

Question 11:

Under market capitalism, goods and services are allocated by a set of decentralized markets.

True or False:

Question 12:

An externality exists whenever the welfare of one individual depends not only on the actions of that individual, but also on the actions of some other individual as well

True or False:

Question 13:

A public good is one for which use by one individual does not affect use by others

True or False:

Question 14:

Individual rationality implies social rationality

True or False:

Question 15:

The Coase theorem states that the assignment of property rights among parties determines the efficient allocation of resources.

True or False: