A market economy produces the optimal amount of each good at least cost when ________.

Question

Quizplus · Accepted Answer

In a market economy, firms produce goods where marginal cost equals marginal revenue, which occurs at the minimum point of the average total cost (ATC) curve. At this point, price equals ATC, indicating that the firm is producing at the lowest cost possible while also meeting consumer demand. Therefore, choice B is the correct answer.

A Market Economy Produces the Optimal Amount of Each Good