Answered: Perfect Competition in the long run:…

Perfect Competition in the long run: Group of answer choices .results in both productive and allocative efficiency results in neither productive or allocative efficiency

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter7: Perefect Competition

Section: Chapter Questions

Problem 10SQ

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Concept explainers

Accounting and Economic Profit analysis

One comes across the concept of Profits in the context of business and in analyzing the results of business activity. Profits of a business can be accounting profits, and they can also be economic profits. So how does one understand the concept of accounting versus economic profits?

Question

Perfect Competition in the long run:

Group of answer choices

.results in both productive and allocative efficiency

results in neither productive or allocative efficiency

results in allocative but not productive efficiency

results in productive efficiency but not allocative efficiency

Definition Definition State in which the marginal benefit to a consumer is equal to the marginal cost of producing a product. Allocative efficiency occurs when all the market participants (buyers and sellers) have all of the knowledge required to make informed decisions regarding consumption and production of goods and services.

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