Question

In the economy, allocative efficiency takes place a. when deadweight loss of goods and services in...

In the economy, allocative efficiency takes place

a. when deadweight loss of goods and services in an economy occurs with flawed distribution.
b. when the distribution of goods and services is at its ideal or optimal.
c. when goods and services production is at their lowest costs.
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Answer #1

Option (b)

Since allocative efficiency is at the output level where price equals marginal cost.

When ATC is at its minimum then the firm is at its efficient scale.

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