An Efficient Economy Is an Economy

question 209

Multiple Choice

An efficient economy is an economy

• A) in which output is steady or growing and there is low inflation.
• B) that produces what consumers demand and does so at the least possible cost.
• C) that distributes output equally among all consumers.
• D) in which there is a fair distribution of wealth.

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Definitions:

Price/Earnings Ratio

A valuation ratio of a company's current share price compared to its per-share earnings, used to evaluate a company's financial health and growth prospects.

Quick Ratio

A liquidity indicator that evaluates a company's ability to pay its current liabilities without relying on the sale of inventory, calculated as (current assets - inventory) / current liabilities.

Bad Debt Expense

Expense associated with estimated uncollectible accounts receivable.