The Diagram Below Shows the Demand and Supply Curves in a Perfectly

question 117

Multiple Choice

The diagram below shows the demand and supply curves in a perfectly competitive market.
FIGURE 12-5
-Refer to Figure 12-5. Allocative efficiency occurs

• A) at output level Q3.
• B) at output level Q1.
• C) at price P1 and output Q3.
• D) at price P2 and output Q2.
• E) where the areas 1, 2, 3, and 4 are maximized.

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