A competitive market produces the economically efficient outcome if the following conditions are met, except
A)the market produces only units for which benefits are at least equal to cost.
B)the market demand curve reflects the buyers' full willingness to pay.
C)the market supply curve reflects all costs of production.
D)the market produces only units for which costs are at least equal to benefits.

Question

Quizplus · Accepted Answer

Options A and D are essentially stating the same principle but in reverse order, indicating a redundancy rather than an exception to the conditions for economic efficiency in a competitive market. The economically efficient outcome is achieved when the benefits of producing a unit are at least equal to the costs of producing it, which is what both A and D describe. However, the question asks for an exception to the conditions for economic efficiency, making D the incorrect choice because it does not serve as an exception but rather restates a condition similar to A.

A Competitive Market Produces the Economically Efficient Outcome If the Following