How does the text define economic efficiency? Is this an absolute or a relative definition? Would another type of definition be preferable? Why or why not?
The text defines economic efficiency contextually, for example, within the context of a particular state of affairs. It is efficient to undertake activities that generate additional benefits in excess of costs. Similarly, it is inefficient if an action generates costs that exceed benefits. This relative definition is acceptable. Since economic thinking is marginal thinking, efficiency always must be defined in relative terms. An absolute definition does not appear possible.
You might also like to view...
Workers in the United States are ________ workers in China because ________
A) more productive than; workers in the United States have more capital per worker. B) more productive than; there are more college-educated workers in the United States. C) less productive than; the labor force participation rate is lower in the United States. D) less productive than; there are fewer workers in the United States. E) equally as productive as; China's real GDP per person equals the U.S. real GDP per person.
The figure above shows the marginal social cost curve of generating electricity, the marginal private cost curve, and the demand curve
If the government imposes a pollution tax to achieve the efficient level of production, the tax equals ________ per kilowatt hour. A) 0¢ B) 7.5¢ C) 10¢ D) 15¢ E) 2.5¢
Suppose favorable weather resulted in a bumper crop of oranges in Florida. In the market for oranges
A) the supply curve shifted to the right resulting in a decrease in the equilibrium price. B) the demand curve shifted to the right resulting in an increase in the equilibrium price. C) the supply curve shifted to the right resulting in an increase in the equilibrium price. D) the demand curve shifted to the left resulting in a decrease in the equilibrium price.
Railroads fueled the expansion of all markets in the post-bellum period of U.S. history
Indicate whether the statement is true or false