For Allocative Efficiency to Hold

question 2

Multiple Choice

For allocative efficiency to hold,

• A)price must equal marginal revenue of the last unit sold.
• B)price must equal the marginal cost of the last unit produced.
• C)the average variable cost must be minimized in production.
• D)the average total cost must be minimized in production.

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Definitions:

Universal Proposition

A categorical proposition that makes an assertion about all members of the class designated by its subject term (A and E).

S are P

A simplified expression of a categorical proposition where "S" is the subject term and "P" is the predicate term, typically used to state a general relationship or attribute shared by all members of S.

Venn Diagram

A diagram that uses overlapping circles to illustrate the logical relationships between different sets of items or groups.

Universal Proposition

A statement that asserts something about every member of a particular category or class.