X-inefficiency refers to a situation in which a firm
A)is not as technologically progressive as it might be.
B)encounters diseconomies of scale.
C)fails to realize all existing economies of scale.
D)fails to achieve the minimum average total costs attainable at each level of output.

Question

Quizplus · Accepted Answer

X-inefficiency occurs when a firm does not minimize its costs for a given level of output, thus failing to achieve the lowest possible average total cost.

X-Inefficiency Refers to a Situation in Which a Firm