ECO100Y5 Lecture Notes - Price Ceiling, Allocative Efficiency, Marginal Revenue

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Published on 16 Oct 2011
School
UTM
Department
Economics
Course
ECO100Y5
Professor
Page:
of 9
CH.12
Productive Efficiency
1. Produce given output with minimum input (produce at lowest cost)
2. Marginal Cost must be equal for all firms making industry more efficient
Allocative Efficiency
MC = P
All Efficient
Many Firms
Industry
(also efficient) Efficient Industry Efficient Industry etc…..
Effiecient Economy
( if all industry’s in economy are efficient then economy will too be efficient)