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Nataly_w [17]
3 years ago
14

What is meant by allocative efficiency? Allocative efficiency is when every good or service A. is produced up to the point where

price equals marginal cost B. Is produced at lowest possible cost C. produced generates an equal amount of consumer surplus and producer surplus D. is produced up to the point where price equals marginal revenue E. is produced up to the point where the difference between the marginal benefit for consumers and the marginal cost of producing it is maximized
Business
1 answer:
Alborosie3 years ago
5 0

Answer:

Option (E) is correct.

Explanation:

Allocative efficiency is created when the gap between marginal benefit and marginal cost is maximum. The marginal benefit is the benefit that a consumer can get by consuming an additional unit of a commodity and the marginal cost is the cost that a producer incurred by producing an additional unit.

Hence, the allocative efficiency is achieved where the difference between these two terms is maximized.

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Answer:

Income will increase by $84.

Explanation:

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First, we need to calculate the unitary variable cost:

Unitary variable cost= 120*0.3= $36

<u>Now, the unitary contribution margin:</u>

unitary contribution margin= 120 - 36

unitary contribution margin= $84

Income will increase by $84.

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3 years ago
No trespassing signs are an example of owners enforcing their right to
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Answer:

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Answer:

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p* = 0.33

Q = norminv(0.33,250,100)

The production capacity the manufacturer should reserve for the last day = 206.00 units

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