B. Answer the following true-false questions: 1. Under perfect competition, there can be no inequality because everyone is treated the same. 2. Horizontal equity states that everyone in the same class is treated the same. 3. Robert Reich believes there is market failure and therefore a need for government intervention. 4. A policy tool to address income inequality is a sales tax. 5. The term monopoly power is used in economics when a political party controls all branches of government.
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False. Under perfect competition, there can still be inequality in terms of income and wealth distribution among individuals and firms. Perfect competition refers to a market structure where there are many buyers and sellers, homogeneous products, free entry and Show more…
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