The equilibrium of a competitive industry is:
A)equitable but not necessarily efficient.
B)efficient.
C)not always efficient.
D)neither efficient nor equitable.

Question

Quizplus · Accepted Answer

The equilibrium of a competitive industry is efficient because it maximizes total economic surplus, which means that there is no way to make anyone better off without making someone else worse off. It may not be equitable, as some participants may benefit more than others, but efficiency is the primary goal of a competitive market. Therefore, option B is the correct answer.

The Equilibrium of a Competitive Industry Is