Perfect competition results in productive efficiency and allocative efficiency, while monopolistic competition results in ________. a....

Question

Question

Perfect competition results in productive efficiency and allocative efficiency, while monopolistic competition results in ________.

a. both allocative and productive efficiency

b. allocative efficiency, but not productive efficiency

c. productive efficiency, but not allocative efficiency

d. neither allocative nor productive efficiency

Answer 1

Answer #1

Productive efficiency occurs when goods are produced at the lowest average cost

Allocative efficiency occurs when goods are produced where MC=MB

In a monopoly, neither happens

option(D)

Answer 2

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