0
What market structure is used to benchmark allocative efficiency and why do we use it?
Wiki User
∙ 8y agoWant this question answered?
Be notified when an answer is posted
Add your answer:
Earn +20 pts
How does competition in a market affect allocative and productive efficiency?
A competitive market, firms act with their benefit at heart. If a firm is producing at productive efficiency, it produces goods at a relatively low expenditure, it can sell at low prices and hence compete well in the market.
What is meant by an efficient market equilibrium?
When there is allocative and productive efficiency, there is an efficient market equilibrium, allocative efficiency is when the products that are most wanted are produced, this is achieved when price equals marginal cost, productive efficiency is achieved when the firm is producing on the lowest point on the lowest average cost curve, this is also called the point of technical efficiency, both allocative and productive efficiency lead to an optimum allocation of resources and economic efficiency is achieved, though, this is thought to exist only in a perfectly competitive market and is lacking in other markets because monopolies and oligopolies usually have their prices above marginal cost and that is not an efficient allocation of resources and because other markets may lack the incentive to produce at the lowest cost
Discuss whether economic efficiency as described in text books is likely to be able to be achieved in practice?
Economic efficiency is said to be achieved when both the conditions of productive and allocative efficiency are fulfilled. Productive efficiency arises when productin is carried out at lowest cost, i.e, at minimum average cost. On the other hand allocative efficiency arises when resources are allocated to teh production of those goods and services which consumers demand the most. This efficiency arises when price is equal to teh marginal cost of the good or service. Economic efficiency exists in the idealistic perfect market model of perfect competition. However this market structure barely exists. Imperfections exist in all markets. Moreover even if a market is eficient there may be a misallocation of resources which does not give rise to wellbeing of the economy. Hence economic efficiency does not necessarily lead to welfare economics.
Explain the concept of Market Efficiency Is Arbitrage possible in an efficient market Why or why not What is some of the evidence for and against market efficiency No more than two pages please?
what are the types of market efficiency in nigeria?
What are the benefits and drawback for a country that is relying more on the market system?
Benefits:Allocative and productive efficiency: Since free market operates on demand and supply, at any time, there will be a productive efficiency (where average cost is minimum) and allocative efficiency (where society welfare is maximum.)Doesn't need to manage: Since price acts as a signal (to change production and consumption level) and an incentive (to produce), there is no need to manage and research each of those demand - which often leads to misinformation (as happened with planned economy.DrawbacksMarket failures: Free market creates room for market failures include demerit goods/ merit goods/ public goods/ monopoly/ externalities.... which can harm the society as a whole.
How does competition in a market affect allocative and productive efficiency?
A competitive market, firms act with their benefit at heart. If a firm is producing at productive efficiency, it produces goods at a relatively low expenditure, it can sell at low prices and hence compete well in the market.
What is meant by an efficient market equilibrium?
When there is allocative and productive efficiency, there is an efficient market equilibrium, allocative efficiency is when the products that are most wanted are produced, this is achieved when price equals marginal cost, productive efficiency is achieved when the firm is producing on the lowest point on the lowest average cost curve, this is also called the point of technical efficiency, both allocative and productive efficiency lead to an optimum allocation of resources and economic efficiency is achieved, though, this is thought to exist only in a perfectly competitive market and is lacking in other markets because monopolies and oligopolies usually have their prices above marginal cost and that is not an efficient allocation of resources and because other markets may lack the incentive to produce at the lowest cost
Discuss whether economic efficiency as described in text books is likely to be able to be achieved in practice?
Economic efficiency is said to be achieved when both the conditions of productive and allocative efficiency are fulfilled. Productive efficiency arises when productin is carried out at lowest cost, i.e, at minimum average cost. On the other hand allocative efficiency arises when resources are allocated to teh production of those goods and services which consumers demand the most. This efficiency arises when price is equal to teh marginal cost of the good or service. Economic efficiency exists in the idealistic perfect market model of perfect competition. However this market structure barely exists. Imperfections exist in all markets. Moreover even if a market is eficient there may be a misallocation of resources which does not give rise to wellbeing of the economy. Hence economic efficiency does not necessarily lead to welfare economics.
What countries are not close to free market benchmark?
North Korea
Explain the concept of Market Efficiency Is Arbitrage possible in an efficient market Why or why not What is some of the evidence for and against market efficiency No more than two pages please?
what are the types of market efficiency in nigeria?
What are the benefits and drawback for a country that is relying more on the market system?
Benefits:Allocative and productive efficiency: Since free market operates on demand and supply, at any time, there will be a productive efficiency (where average cost is minimum) and allocative efficiency (where society welfare is maximum.)Doesn't need to manage: Since price acts as a signal (to change production and consumption level) and an incentive (to produce), there is no need to manage and research each of those demand - which often leads to misinformation (as happened with planned economy.DrawbacksMarket failures: Free market creates room for market failures include demerit goods/ merit goods/ public goods/ monopoly/ externalities.... which can harm the society as a whole.
What is a benchmark survey?
A benchmark survey is a research method used to evaluate how organizations or individuals perform in comparison to industry standards or best practices. It involves collecting data on specific metrics and analyzing it to measure the performance level or identify areas for improvement. Benchmark surveys can help organizations set goals, track progress, and make informed decisions based on industry benchmarks.
What is meant by efficiency continuum?
The efficiency continuum refers to capital markets. Within a capital market, if something is reasonable and efficient to the market, it is said to be on the efficiency continuum.
Market structure of Australia?
market structure of Australia
Describe the structure of the media market?
the structure of the media market?
Is an oligopoly market structure the most efficient market structure?
no it is not
Which of the following is characteristic of a competitive market?
efficiency
