What is meant by productive efficiency? How does a perfectly competitive firm achieve productive efficiency?
What will be an ideal response?
Productive efficiency refers to the situation in which a good or service is produced at the lowest possible cost, in particular, every good or service is produced up to the point where the last unit is produced where the market price is equal to minimum average total cost.
You might also like to view...
The loss associated with the fact that at the profit-maximizing quantity consumers value the goods more than it cost to produce them is called
A) deadweight loss. B) comparative loss. C) Lerner Loss. D) Consumer Value Loss.
What is the underlying assumption of the original, simplified Keynesian model?
A) The relevant range of the short-run aggregate supply curve (SRAS) is vertical. B) The relevant range of the aggregate supply curve (AS) is vertical. C) The relevant range of the short-run aggregate supply curve (SRAS) is horizontal. D) The relevant range of the long-run aggregate supply curve (LRAS) is horizontal.
The slope of the budget line is the amount of one commodity that a consumer must give up in order to obtain an additional unit of the other commodity
a. True b. False Indicate whether the statement is true or false
When persons underestimate inflation (when actual inflation exceeds the expected rate), actual unemployment will
a. exceed the natural rate of unemployment. b. equal the natural rate of unemployment. c. fall below the natural rate of unemployment. d. increase if the government is running a budget deficit and decrease if a budget surplus is present.