The efficiency condition requires:
A) marginal costs be generally less than marginal benefits.
B) prices in the marketplace confront decision makers with the marginal benefits and marginal costs of their decisions.
C) more goods be produced than exchanged.
D) more goods be exchanged than produced.

Question

Quizplus · Accepted Answer

The efficiency condition requires that prices in the marketplace confront decision makers with the marginal benefits and marginal costs of their decisions. This means that decision makers should be able to weigh the benefits and costs of their actions and make efficient choices based on those factors. Marginal costs should generally be less than marginal benefits to maximize efficiency. Choices A, C, and D are all incorrect because they do not accurately describe the efficiency condition.

The Efficiency Condition Requires