A competitive market can produce economically efficient outcomes if these conditions are met, except:
A) The market produces only units for which benefits are at least equal to cost
B) The market demand curve reflects the buyers' full willingness to pay
C) The market supply curve reflects all costs of production
D) The market produces only units for which costs are at least equal to benefits

Question

Quizplus · Accepted Answer

Option D contradicts the principle of economic efficiency, which requires that the market produces only units for which benefits are at least equal to costs. Therefore, option D is the only exception to the conditions that are required for a competitive market to produce economically efficient outcomes.

A Competitive Market Can Produce Economically Efficient Outcomes If These