A Condition Necessary for a Market to Achieve Economic Efficiency

question 179

Multiple Choice

A condition necessary for a market to achieve economic efficiency is that the market:

• A) demand curve must include the willingness to pay of all members of society who benefit from the good.
• B) demand curve must exclude the willingness to pay of all members of society who benefit from the good.
• C) demand curve must include all opportunity costs imposed on society for producing the good.
• D) supply curve must include the willingness to pay of all members of society who benefit from the good.

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Definitions:

Proportional

A relationship between two quantities where a change in one results in a corresponding change in the other, often depicted mathematically by a constant ratio.

Compass Needle

A magnetized pointer free to align itself with Earth's magnetic field, used for navigation.

Permanent Magnets

Magnets that do not require an external force to maintain their magnetic properties.

Field

In the context of electromagnetism, it refers to the region around a charged particle or object within which a force would be exerted on other charges or magnetic materials.