The equality-efficiency trade-off suggests that

A) welfare programs stimulate incentives to work.
B) inefficiencies result when incentives to produce are reduced.
C) noncash transfers are superior to cash transfers.
D) economic growth is the best means of reducing poverty.

The equality-efficiency trade-off suggests that when policies are designed to increase equality (for example, through redistributive taxation), they may reduce the incentives for production, leading to inefficiencies. This is because individuals might not be as motivated to work hard or invest if they know a significant portion of their earnings will be redistributed.