Question : 1) Productive efficiency for an individual firm requires that A) all : 1384258

1) Productive efficiency for an individual firm requires that

A) all resources be fully used.

B) MC = P for all goods.

C) the firm be on its LRAC curve.

D) the firm be allocatively efficient.

E) P = ATC for all goods.

2) For an entire economy, allocative efficiency requires that

A) goods are allocated equitably across markets.

B) marginal cost equals price for all goods.

C) MRP is equated for all factors of production.

D) price equals average cost for all goods.

E) price is greater than marginal cost for all goods.

3) Consider two firms, A and B, that are producing the same product but with different marginal costs. In this case,

A) a reallocation of output between the firms can lower the industry’s total cost.

B) neither firm is producing its output at the lowest attainable cost.

C) some resources must be unemployed.

D) each firm is being wasteful.

E) one firm is not maximizing profits.

4) If the total output of some industry is allocated among its individual firms in such a way that the total cost of producing the industry’s output is minimized, the industry will achieve

1) full employment of resources;

2) productive efficiency;

3) allocative efficiency.

A) 1 only

B) 2 only

C) 3 only

D) both 1 and 3

E) both 2 and 3

5) All points on a country’s production possibilities boundary are

A) allocatively efficient.

B) points at which P = MC for all goods.

C) productively efficient.

D) Pareto optimal.

E) not productively efficient.

6) Consider two firms, A and B, that are producing the same product but with different average costs. Economists say this situation reflects a problem of

A) unemployed resources.

B) economic inefficiency.

C) productive inefficiency.

D) allocative inefficiency.

E) Not necessarily any of the above.

7) If an economy is productively inefficient, it could improve its situation by

A) moving along its production possibilities boundary.

B) moving beyond its production possibilities boundary.

C) moving onto its production possibilities boundary.

D) acquiring more resources.

E) trading some of its resources.

8) An economy will be allocatively efficient if

A) the economy’s resources are fully employed.

B) all firms are breaking even.

C) the average cost of production is the lowest possible for all goods produced.

D) price equals marginal cost for all products.

E) the price equals average cost for all goods.

9) An economy will be allocatively efficient if

A) least-cost production techniques are employed by all firms.

B) the marginal costs of all firms in an industry are equal.

C) marginal cost equals price for all goods.

D) the economy’s resources are fully employed.

E) imperfectly competitive markets are regulated.

10) If all firms are profit maximizers, then the following is assured:

A) allocative efficiency.

B) each firm is productively efficient.

C) allocative and productive efficiency.

D) that the economy reaches the production possibilities boundary.

E) that firms attain the lowest possible average costs.