Efficiency is defined as
A) the maximum consumption of goods.
B) the production of goods and services.
C) the production of output at minimum cost.
D) the most profits for companies.

Question

Quizplus · Accepted Answer

Efficiency refers to the production of output at the lowest possible cost. This means that resources are utilized in the best possible way to achieve maximum output. The focus is on minimizing waste, reducing idle time, and optimizing the use of resources such as labor, capital, and materials to produce goods and services in the most cost-effective manner. This helps businesses to increase profitability and remain competitive in the market. A and D are incorrect because efficiency is not about maximizing consumption or profits but about minimizing cost while maintaining high productivity. B is incorrect as it is too general and fails to capture the cost aspect of efficiency.

Efficiency Is Defined as