A perfectly competitive industry achieves allocative efficiency in the long run. What does allocative efficiency​ mean?   A. Firms use an input combination that minimizes cost and maximizes output.   B. Production occurs at the lowest average total cost.   C. Each firm produces up to the point where the price of the good equals the marginal cost of producing the last unit.   D. Each firm produces up to the point where all scale economies are exhausted.

Q: The online shopping market is perfectly competitive. Profit-maximizing firms in the market are…

A: Perfect competition is observed when all firms sell homogenous goods, market share does not…

Q: A perfectly competitive firm produces 3,000 units of a g fixed cost of production is $20,000. The…

A: Since you have posted two independent questions, according to the guidelines, only the first…

Q: 5. Long Run Producer Surplus a. In the long run equilibrium of a perfectly competitive firm, fixed…

A: During the Long run production function all the factors are variables:  Land Labor Capital All the…

Q: How would a pizzeria in a densely populated area with 20 to 50 competitors thrive in a pure short…

A: The pizzeria could thrive in short run than long run, because of several factors. In short run, it…

Q: For Perfect competition markets, determine whether there is market supply curve or not. If yes, how…

A: Perfect competition market refers to the market conditions in which there are many sellers and…

Q: Refer to the above figure. The firm is currently producing at Q2. The firm should Select one: A.…

A: A firm is an organization that produces and sells goods and services to earn profits in the form of…

Q: Suppose a firm in a perfectly competitive industry develops a manufacturing innovation that lower…

A: The perfect competition refers to a type of market structure which is characterized by a large…

Q: perfectly competitive industry with constant costs initially operates in long-run equilibrium. When…

A: The shape of the long-run supply curve relies on the related cost of production with the expansion…

Q: In a perfectly competitive industry, firms are likely to Multiple Choice A.) exit when there are…

A: Introduction When there are numerous buyers and sellers, perfect competition results in prices that…

Q: When discussing pure competition, the term long run refers to a period of time long enough to allow:…

A: Option ‘c’ is the correct answer. Option ‘c’ - Because Option ‘a’ and ‘b’ both are correct. Hence,…

Q: Consider the following data: equilibrium price = $12, quantity of output produced = 125 units,…

A: The short run is a concept that states that, within a certain period in the future, at least one…

Q: Multiple choice - microeconomics 43) What will entry into a market by new firms do?  A. It will…

A: "Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: What are the characteristics of a perfectly competitive industry?

A: Perfectly competitive market refers to market where large number of buyers and sellers participate…

Q: a. What is its profit?b. What is its marginal cost?c. What is its average variable cost?d. Is the…

A: Given: Average Revenue (AR) = $10Average Total Cost (ATC) = $8Fixed Cost (F) = $200Quantity (Q) =…

Q: Fill in the blanks with the number that corresponds to the correct word or phrase in the word bank…

A: A perfectly competitive market is a theoretical model of a market structure characterized by…

Q: unuou A tomato farmer operates in a perfectly competitive industry. Revenues are $2,000 a montn, toi…

A: Perfectly competitive market structure is the market structure in which there are large number of…

Q: In a market that allows free entry and exit, when does the process of entry and exit end for the…

A: New firms enter the market when existing firms are making a positive economic profit in the short…

Q: for a firm that operates in a perfectly competitive market. a. What level of output should this firm…

A: A perfectly competitive firm is a price taker, which means it takes the price set by the market…

Q: The graph below shows the marginal cost (MC), average variable cost (AVC), and average total cost…

A: We can see that one of the axis we see the cost and profit is given, the verticle axis.Here, the…

Q: Economics A firm's supply curve is key to economic reasoning. Derive the supply curve of an…

A: Short-Run Supply Curve The y-axis represents price (P).The x-axis represents quantity supplied…

Q: Explain the concept of a perfectly competitive market and its characteristics.

A: A perfectly competitive market is a financial model that portrays a speculative market structure. In…

Q: . Identify the defining characteristics of a Perfectly Competitive Market.

A: "Since you have asked multiple questions,we will solve first question for you.If you want the…

Q: 7. Which of the following is true? a. Productive efficiency occurs in perfect competition because…

A: 7.In perfect competition,both productive and allocative efficiency is there.That would be the case…

Q: a) Describe the factors that drive profits to zero in perfectly competitive markets in the long run.…

A: Step a) Factors Driving Profits to Zero in Perfectly Competitive Markets in the Long RunIn perfectly…

Q: Ms. Olivia operates a business in a competitive market. The current market price $9.00. At her…

A: A manager maximizes profit when the value of the last unit of product (marginal revenue) equivalent…

Productive and Allocative Efficiency Analysis

Productive efficiency, also referred to as production efficiency is a term in economics describing the level at which a company is operating at its maximum capacity. Beyond this point, the entity will be unable to manufacture any additional goods without cutting down another product’s production level. This occurrence is an outcome of production happening alongside a Production Possibility Frontier (PPF).