The answer is true. There is no relationship between Pareto efficiency and equity! A Pareto efficient outcome, in particular, may be extremely inequitable.
The pareto efficiency implies that resources are allocated in the most cost-effective way possible, but it does not imply the equality or fairness. When no economic changes can make one person better off without making at least one other person worse off, the economy is said to be in a Pareto optimal state. It denotes a situation in which no further improvements to inequitable well-being can be made through resource reallocation that benefits at least one person.
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