Resources are efficiently allocated when production occurs at that output level where price
A)equals marginal cost.
B)equals marginal revenue.
C)is greatest over average cost.
D)is equal to average total cost.

Question

Quizplus · Accepted Answer

Resources are efficiently allocated when the price of a good equals its marginal cost. This condition ensures that the value consumers place on the last unit produced is equal to the cost of producing that unit, maximizing economic welfare.

Resources Are Efficiently Allocated When Production Occurs at That Output