If a Market Is Efficient, Then

question 41

Multiple Choice

If a market is efficient, then

• A) the market allocates buyers to the sellers who can produce the good at least cost.
• B) all of these answers.
• C) the quantity produced in the market maximizes the sum of consumer and producer surplus.
• D) the market allocates output to the buyers that value it the most.

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Definitions:

Debt-To-Equity Ratio

A financial proportion depicting how much of a company's assets are financed through debt versus equity from shareholders.

Balance Sheet

a financial statement that provides a snapshot of a company's financial position at a particular point in time, detailing assets, liabilities, and equity.

Income Statement

A report detailing income and outgoings of a business for a set time frame, culminating in a profit or deficit.

Times Interest Earned

A financial ratio that measures a company's ability to meet its interest payments on outstanding debt from its operating earnings.