An Efficient Level of Output Means

question 24

Multiple Choice

An efficient level of output means:

• A)the total social benefit less the total social cost is maximized.
• B)the total social benefit is below the total social cost.
• C)the total social cost equals the total social benefit.
• D)the total social benefit less the total social cost can be improved.

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Definitions:

Marginal Cost

The change in total cost that arises when the quantity produced is incremented by one unit.

Average Total Cost

The total cost of production divided by the total quantity produced, representing the cost per unit of output.

Average Variable Cost

The per-unit variable cost of production, calculated by dividing total variable costs by the quantity of output produced.

Marginal Cost

The increase in total production cost when output is increased by one unit.