Which of the following is true in a competitive market equilibrium?

Question

Quizplus · Accepted Answer

In a competitive market equilibrium, the market reaches an optimal allocation of resources where the marginal benefit (MB) equals the marginal cost (MC) of the last unit sold. This is because any further production or consumption would result in a decrease in surplus for either producers or consumers. Therefore, D is the correct answer. A, B, and C are not necessarily true in a competitive market equilibrium. Total consumer and producer surplus may not be equal, marginal benefit and marginal cost may not be maximised for all goods and services, and the distribution of surplus between consumers and producers may not be equal.

Which of the Following Is True in a Competitive Market