A Perfectly Competitive Industry Is Said to Be Efficient Because

question 50

Multiple Choice

A perfectly competitive industry is said to be efficient because the:

• A)marginal cost of production of the last unit of output is minimized in the long run.
• B)product is standardized across firms in the industry.
• C)average total cost of production of the industry's output is minimized in the long run.
• D)market price of the good is equal to economic profit for all firms in the industry.

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Definitions:

Internal Improvements

Public works, such as roads, bridges, canals, and harbors, funded by the government to facilitate commerce and communication.

Old Northwest

Refers to the region of the United States northwest of the Ohio River, which was acquired through the Treaty of Paris in 1783 and organized under the Northwest Ordinance of 1787.

Interchangeable Parts

Interchangeable parts are components that are made to specifications that ensure they are so nearly identical that they will fit into any assembly of the same type, reducing manufacturing complexity and allowing for easier repair of mechanical systems.

Labor Surplus

A situation in which the supply of workers exceeds the demand for their services, often leading to unemployment and lower wages.