Efficient production decisions occur when _____ forces lead firms to produce the output level where ____.
A)market; average cost is at a minimum
B)market; price equals marginal cost
C)cost; average cost is at a minimum
D)cost; price equals marginal benefit

Question

Quizplus · Accepted Answer

Efficient production decisions occur when market forces lead firms to produce the output level where price equals marginal cost. At this output level, the firm is producing at the lowest possible cost and is maximizing its profits.

Efficient Production Decisions Occur When _____ Forces Lead Firms to Produce