When economic efficiency is attained, it implies all of the following, except
A)per-unit cost of output produced is at minimum.
B)allocative efficiency is achieved.
C)total consumer and producer surplus is at a maximum.
D)the gap between marginal benefits and marginal costs of production is at maximum.

Question

Quizplus · Accepted Answer

Economic efficiency implies that resources are allocated in the most efficient manner, meaning per-unit costs are minimized (A), allocative efficiency is achieved (B), and total consumer and producer surplus is maximized (C). The statement in D is incorrect because when economic efficiency is attained, the marginal benefits equal the marginal costs of production, not that their gap is at a maximum.

When Economic Efficiency Is Attained, It Implies All of the Following