Resources are efficiently allocated when production occurs at that output at which

A) P equals MR.
B) P equals AVC.
C) P exceeds MR.
D) P equals MC.

Question

Resources are efficiently allocated when production occurs at that output at whichA) P equals MR.B) P equals AVC.C) P exceeds MR.D) P equals MC.

Joshivel Perucho · Accepted Answer

Final Answer : D, Explanation :  Resources are efficiently allocated when the price (P) equals the marginal cost (MC) of production. This condition ensures that the value consumers place on a good is equal to the cost of producing an additional unit, leading to an optimal allocation of resources.

Resources are efficiently allocated when production occurs at that output at which

A) P equals MR.
B) P equals AVC.
C) P exceeds MR.
D) P equals MC.

Definitions

Learning Objectives

Learning Objectives

Related questions