Allocative Efficiency Involves Determining

question 198

Multiple Choice

Allocative efficiency involves determining

• A) which output mix will result in the most rapid rate of economic growth.
• B) which production possibilities curve reflects the lowest opportunity costs.
• C) the mix of output that will maximize society's satisfaction.
• D) the optimal rate of technological progress.

---

Definitions:

Flexible Budget

A budget that adjusts or varies with changes in volume or activity, allowing for more accurate budgeting in variable operating environments.

Machine-Hours

A measure of production time, where one machine-hour equals the operation of one machine for one hour.

Static Planning Budget

A budget based on a single level of activity, not adjusting for actual levels of activity experienced.

Planning Budget

A financial plan for a specific time period, outlining expected revenue, expenses, and resource allocations to achieve business goals.