Figure 11.10

-Refer to Figure 11.10.What is the allocatively efficient output for the firm represented in the diagram?

Name: Figure 11.10 -Refer to Figure 11.10.What is the allocatively efficient output for the firm represented in the diagram?
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Question

Figure 11.10
 
-Refer to Figure 11.10.What is the allocatively efficient output for the firm represented in the diagram?

Quizplus · Accepted Answer

Allocative efficiency occurs where price equals marginal cost (P=MC). In the given figure, the MC curve intersects the demand curve at point Qh, where the price is equal to P*. Therefore, the allocatively efficient output for the firm is Qh units.

Figure 11.10 -Refer to Figure 11.10.What Is the Allocatively Efficient Output for Allocatively