An Efficient Use of Resources Occurs When

question 6

Multiple Choice

An efficient use of resources occurs when

• A)a deadweight loss arises.
• B)total social benefit from a good equals its total social cost.
• C)producer surplus is eliminated.
• D)consumer surplus is maximized.
• E)a monopoly practices perfect price discrimination.

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Definitions:

Dominant Strategies

In game theory, strategies that are best for a player regardless of what the other players choose.

Credible Threat

A statement or action that is believable and carries the weight of possible enforcement, often used in negotiations or strategic situations.

Economies of Scale

The cost advantages that enterprises obtain due to size, output, or scale of operation, with cost per unit of output generally decreasing with increasing scale.

Diseconomies of Scale

The phenomenon where a firm's per unit costs increase as it increases production, typically due to inefficiencies.