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what is productive efficiency quizlet a situation

It can be achieved when goods and/or services have been distributed in an optimal manner in response to consumer demands (that is, wants and needs), and when the marginal cost and marginal utilityof goods and services are equal. Simply put, it is always measured against a defined standard, in essence, the actual output produced will be compared with the standard output, in order to ascertain the efficiency in the production process. Efficiency determines how well the output is produced, or objective is attained as planned with minimum costs. A firm is said to be productively efficient when it is producing at the lowest point on the average cost … A situation in which the market price for each good is equal to that good's marginal cost. Productive efficiency means that, given the available inputs and technology, it’s impossible to produce more of one good without decreasing the quantity of another good that’s produced. A.It refers to a situation in which resources are allocated such the last unit of output produced provides a marginal benefit to consumers equal to the marginal cost of producing it. If resources are being used in most efficient way they cannot be used differently to make someone better off without making someone else worse off . Allocative Efficiency. Distributive efficiency occurs when goods and services are consumed by those who need them most. Choose from 500 different sets of ch economics microeconomics ap efficiency flashcards on Quizlet. Consistent output is what drives results. Learn vocabulary, terms, and more with flashcards, games, and other study tools. When the firm chooses among all available production methods to produce a given level of output at the lowest possible cost. It is a situation where the economy can produce more of one product without affecting other production processes. Explain the economic assumption that "people are rational.". Uploaded By ashleyfochi. Things that improve your career, business, organization. II. To explain, a business could produce 10 million units of Product A for $2. where the firm is producing on the bottom point of its average total cost curve. Productive efficiency - A situation in which a good or service is produced at the lowest possible cost. It can earn no economic profits, but will just break even. To be productively efficient means the economy must be producing on its production possibility frontier . Productive efficiency means that, given the available inputs and technology, it’s impossible to produce more of one good without decreasing the quantity of another good that’s produced. Average-cost pricing generally leads to ____. However there is deadweight loss as well. PRODUCTIVE EFFICIENCY: The situation in which a good or service is produced at the lowest possible cost.Efficiency in production occurs when the per-unit cost of production is minimized. Hence, profit-maximizing monopolists' will operate on their LRAC. Costs will be minimised at the lowest point on a firm’s short run average total cost curve. … Dynamic efficiency occurs over time, as innovation reduces production costs. Productive efficiency. Social Efficiency happens when goods and services are optimally distributed, also taking externalities into account. inefficient long-run investment decisions. This requires that marginal cost be equated across all firms. If the economy is wasting resources, it means that it is not producing as much as it could potentially produce. a situation in which a good or service is produced at the lowest possible cost. Productive efficiency is A. when labor, machinery, and other inputs are allocated to produce the goods and services that best satisfy consumer wants O B. when a good or service is produced such that economic surplus is maximized O C. when the average cost of production decreases with output O D. when a good or service is produced such that marginal cost is minimized O E. when a good or service … On relevant output, but the results you achieve might be useless revenue and its costs allocated to their profit... Maximum capacity business focuses on producing a given level of output at the lowest possible cost on a firm revenue! The costs production ( productive efficiency ) and producing according to human preferences ( allocative efficiency looks to optimize the... Curve ( i.e benefits and costs of each unit sold something: having! 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