Productive Efficiency Is Achieved When

question 130

Multiple Choice

Productive efficiency is achieved when

• A)firms add a low profit margin to the goods and services they produce.
• B)firms produce the goods and services that consumers value most.
• C)firms produce goods and services at the lowest cost.
• D)there are no shortages or surpluses in the market.

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Definitions:

Variable Costs

Costs that change in proportion to the level of production or sales activity, such as raw materials and direct labor.

Production Time

The total time required to manufacture a product, from the start of production to the final product being ready for sale.

Sales Mix

The combination of different products or services that a company sells, typically analyzed to understand their relative contributions to overall sales.

Operating Loss

A situation where a company's operating expenses exceed its gross profits, indicating a negative performance.