which one of the following is true regarding "efficiency of competitive markets"? a. government intervention may cause a competitive market to become inefficient b. in a competitive market, efficiency ensures equity. c. overproduction causes a competitive market to be efficient. d. efficiency is attained when producer surplus is maximized. e. competitive markets are always efficient

which one of the following is true regarding "efficiency of competitive markets"? a. government intervention may cause a competitive market to become inefficient b. in a competitive market, efficiency ensures equity. c. overproduction causes a competitive market to be efficient. d. efficiency is attained when producer surplus is maximized. e. competitive markets are always efficient

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter7: Consumers, Producers, And The Efficiency Of Markets

Section: Chapter Questions

Problem 5CQQ

See similar textbooks

Similar questions

How does a market reach equilibrium without any outside intervention? Explain using the supply and demand concept. Please use proper graph.Thank you sir.
What is the term used to describe the situation where resources are allocated in a way that maximizes total surplus? A. Pareto efficiency B. Market equilibrium C. Social welfare D. Deadweight loss
1.What is a market and what is the key to functioning markets? Explain.2. How do competitive markets guide the allocation of resources?3. Give an example of a good or service that should not be allocated entirely by a free, unregulated market. Explain your reasoning. 4. Identify a price control that is, has been, or could be enacted in the real world. Then, explain the potential benefits and drawbacks of that control. A goal of this prompt is to see both sides of an argument, so please come up with at least one argument for and against said price control.
4 Which of the following is true regarding equity and efficiency in competitive markets? a. Competitive markets ensure equity and efficiency b. There is often a trade-off between equiry and efficiency. c. Competitive markets lead to neither equity nor efficiency. d. There is generally agreement about the level of equity and efficiency in a market. e. None of the above. Assume there are two goods, good X and good Y. Good X costs $5 and good Ycosts $10. If your income is $200, which of the following combinations of good X and good Y is on your budget line? a. O units of good X and 18 units of good Y b. 0 units of good X and 20 units of good Y c. 20 units of good X and 0 units of good Y d. 10 units of good X and 12 units of good Y e. all of the above The optimal consumption rule states that total utility is maximized when all income is spent and a. MU/P is equal for all goods. b. MU is equal for all goods. c. P/MU is equal for all goods. d. MU is as high as possible for all goods. e. The…
When a market is in equilibrium, which of the following is not correct Select one: a. the price determines which buyers and sellers participate in the market. b. those buyers who value the good more than the price choose to buy the good. c. those sellers whose costs are less than the price choose to produce and sell the good. d. the marginal cost of producing the last unit of the good is equal to consumers' marginal benefit from consuming the last unit e. the opportunity cost of producing the last unit of the good is equal to the absolute advantage of producing it.
Which of the following is not a reason why the market outcomes maximizes total surplus? a. The market outcome assures that the producers that supply the good are the lowest cost producers At the market outcome every unit that has a marginal benefit to consumers that is at least as large as the marginal cost of production b. is produced. c. The market outcome maximizes the average consumer surplus. d. The market outcome assures that the good is allocated to the consumers with the highest willingness to pay
Asap
6. Answer the following questions based on the graph below: Price $28 24 22 20 18 es 14 12 10 8 D 4 40 50 70 90 100 110 120 130 140 150 Quantity O 10
1. What are the conditions for an efficient market? Discuss if are they met in the reality.
Name two types of market failure. Explain why eachmay cause market outcomes to be inefficient.
2) Name two types of market failure. Explain why each may cause market outcomes to be inefficient.
The graph shows the competitive market for fitness trackers. Draw a point that shows the efficient quantity of fitness trackers and the marginal social benefit and marginal social cost at the efficient quantity. Label it Efficient. Choose the statement that is correct. O A. At the competitive equilibrium, the market for fitness trackers achieves allocative efficiency. B. If production in the market for fitness trackers is less than the equilibrium quantity, the marginal fitness tracker costs more to produce than the value that consumers place on it. OC. The competitive market pushes the quantity of fitness trackers produced beyond its efficient level. O D. The market for fitness trackers is not in the social interest because buyers and sellers act only in their self-interest. 240- 200- 160- 120- 80- 40- 0- Price (dollars per fitness tracker) 0 D 2 6 8 10 12 14 16 Quantity (millions of fitness trackers per year) >>> Draw only the objects specified in the question. S