In a competitive market,an efficient allocation of resources is characterized by
A)a price greater than the marginal cost of production.
B)the possibility of further mutually beneficial transactions.
C)the largest possible sum of consumer and producer surplus.
D)a value of consumer surplus equal to that of producer surplus.

Question

Quizplus · Accepted Answer

In a competitive market, an efficient allocation of resources occurs when the sum of consumer and producer surplus is maximized. This indicates that resources are being used in the most valuable way according to consumer preferences and production costs, with no further mutually beneficial transactions left unexploited.

In a Competitive Market,an Efficient Allocation of Resources Is Characterized