When a Market Is Efficient,the

question 98

Multiple Choice

When a market is efficient,the

• A) sum of consumer surplus and producer surplus is maximized.
• B) deadweight gain is maximized.
• C) quantity produced is maximized.
• D) marginal benefit of the last unit produced exceeds the marginal cost by as much as possible.
• E) total benefit equals the total cost.

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Definitions:

Good X

A generic term often used in economic models to represent a specific product or commodity in the market.

Market Baskets

A collection of goods and services used as a standard way of tracking the cost of living or inflation over time.

Preferences

In economics, this refers to the ordering of alternatives based on their utility, showing the subjective tastes and choices of individuals.

Complete

Fully accomplished or having all necessary parts or steps.