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Suppose that a change in government policy affects 3 groups of citizens. Member of group A would gain a total of $100 million, members of group B would lose a total $200 million, and members of group C would gain a total of $75 million.
Then considering 3 entities (each group as a whole), which of the following statements is correct?
I. The policy change, with no side payment, would be a Pareto improvement.
II. The policy change, with no side payment, would be a potential Pareto improvement.
III. A side payment exists that, in theory, could make this policy change a Pareto improvement.
A. I and II
B. I, II and III
C. I only
D. II only
E. III only
F. II and III
G. None of the three statements are correct for this policy change.
Find the probability that at least one of the four parts will work. Round to six decimal places.
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