-In the figure above, if 4 million computers are produced per year then the ___________should be produced to achieve the allocatively efficient use of resources
A) marginal cost of a computer exceeds the marginal benefit of a computer, so more computers
B) marginal cost of a computer exceeds the marginal benefit of a computer, so fewer computers
C) marginal benefit of a computer exceeds the marginal cost of a computer, so fewer computers
D) marginal benefit of a computer exceeds the marginal cost of a computer, so more computers

Question

-In the figure above, if 4 million computers are produced per year then the ___________should be produced to achieve the allocatively efficient use of resources
A) marginal cost of a computer exceeds the marginal benefit of a computer, so more computers 
B) marginal cost of a computer exceeds the marginal benefit of a computer, so fewer computers 
C) marginal benefit of a computer exceeds the marginal cost of a computer, so fewer computers 
D) marginal benefit of a computer exceeds the marginal cost of a computer, so more computers

Quizplus · Accepted Answer

Allocative efficiency is achieved when the marginal cost equals the marginal benefit. If the marginal cost exceeds the marginal benefit, fewer computers should be produced to reach allocative efficiency.

-In the Figure Above, If 4 Million Computers Are Produced