Question

models of competitive markets are helpful in understanding real-world markets. to help you to better understand competitive markets, it is important to understand economic efficiency. sort the descriptions below into whether they are characteristics of productive or allocative efficiency.

Answer 1

Productive efficiency focuses on the cost of production while allocative efficiency focuses on the distribution of the products.

In economics, the efficiency or productivity of a business is classified into two types:

• Productive efficiency.
• Allocative efficiency.

These two types of efficiency focus on different aspects of production and selling goods and services.

Productive efficiency: This type implies producing goods at the lowest cost possible. This means:

• Avoiding unnecessary costs.
• Controlling costs when the number of units increases.

Allocative efficiency: This type implies selling or allocating the products in society. This means:

• Considering the maximum amount the customer can pay for a product (marginal benefit).
• Making the cost of production equal to the marginal benefit.

Note: This question is incomplete because the statements that need to be classified are not provided; due to this, I answered the question based on general knowledge.

Learn more in: brainly.com/question/3886960