Economist like purely competitive markets because they result in A. allocative efficiency only B. economic efficiency...
Homework Answers
Answer:
The correct answer is productive and allocative efficiency (i.e. Option C) because productive efficiency of purely competitive market helps the consumer to buy a good at lowest possible average cost (i.e. it satisfies the P=AC condition) which indicates there is no waste in purely competitive market and allocative efficiency allows to set the price equal to marginal cost (i.e. it satisfies the P=MC condition) which indicates at the market price marginal social benefit equals marginal social cost.
Hence, the correct answer is Option C (i.e. productive and allocative efficiency).
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Economist like purely competitive markets because they result in
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