Productive efficiency is generated by
A)competition among buyers.
B)competition among sellers.
C)government inspectors.
D)government production rules and regulations.

Question

Quizplus · Accepted Answer

Productive efficiency is achieved when firms produce goods and services at the lowest possible cost. This is often achieved through competition among sellers, who are incentivized to reduce costs in order to offer lower prices to attract consumers. Competition among buyers (choice A) is not a factor that directly affects productive efficiency, and government inspectors and regulations (choices C and D) may help ensure product quality and safety, but do not necessarily improve productive efficiency.

Productive Efficiency Is Generated by