A Competitive Market with No Externalities Is Efficient When It

question 56

Multiple Choice

A competitive market with no externalities is efficient when it is in equilibrium because

• A) total benefit equals total cost.
• B) marginal benefit equals marginal cost.
• C) consumer surplus equals producer surplus.
• D) the sum of consumer surplus plus producer surplus is minimized.
• E) the deadweight gain equals its maximum.

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Definitions:

Selection Bias

A statistical bias that occurs when the sample is not representative of the population being studied, leading to skewed and possibly inaccurate outcomes.

Survivor Bias

Survivor bias exists when a sample includes only observations that have remained in the sample over time making that sample unrepresentative of the broader population.

Selection Bias

A systematic error made in choosing individuals or groups to participate in a study, leading to non-random sampling.

Economic Research

The systematic study of the economy or economic phenomena, involving the collection and analysis of data to enhance understanding of economic processes.