Consider the Efficiency of Various Market Structures

question 84

Multiple Choice

Consider the efficiency of various market structures.In the absence of other market failures,allocative efficiency is achieved only under perfect competition because only this market structure results in

• A)zero long-run profits.
• B)P = MC.
• C)complete freedom of entry and exit.
• D)maximization of profits through competition.
• E)productive efficiency.

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Definitions:

Rent Revenue

Income earned from leasing out properties or real estate to tenants.

Adjusting Entries

Adjusting entries are journal entries made at the end of an accounting period to update the accounts and ensure they reflect the true financial status of a company.

Prepaid Insurance

Prepaid insurance represents payments made for insurance coverage periods that have not yet occurred, and is recorded as an asset on the company's balance sheet.

Insurance Expense

The cost associated with purchasing insurance policies to protect a business from certain risks, recorded as an expense.