Efficiency - A2 Economics OCR

All the types of efficiency that are relevant to the A2 Transport exam. 

P - price 

MC - marginal cost 

MR - marginal revenue 

AC - average cost 

AR - average revenue 

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  • Created by: Jade
  • Created on: 01-12-12 11:37

1. What is economic efficiency?

  • Economic efficiency occurs in a market when both allocative and productive efficiency are achieved.
  • Economic efficiency occurs when a firm uses the right amount of inputs that are necessary for a given level of output.
  • Economic efficiency occurs when scarce resources are used in a way that maximises consumer satisfaction.
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Other questions in this quiz

2. What is allocative efficiency?

  • Allocative efficiency is when scarce resources are used in a way that maximises consumer satisfaction.
  • Allocative efficiency is where firms are maximising output from given inputs.
  • Allocative efficiency is where firms are achieving economic efficiency

3. Allocative efficiency does not apply to which market structure?

  • Monopolistic competition
  • Monopolies
  • Oligopoly
  • Perfect competition

4. What is true of allocative efficiency?

  • The price paid by the consumer represents the price the supplier is willing to sell for
  • The price paid by the consumer represents the true cost of producing the last unit
  • The price paid by the consumer represents the lowest cost of producing the last unit

5. What is dynamic efficiency?

  • Dynamic efficiency is improvements in products, processes and productivity over time by exploiting economies of scale or successful investment in research and development. In short, efficiency over time.
  • Dynamic efficiency is the creative work undertaken to apply scientific and technological innovations to products and processes.

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davidsalter

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A set of 10 questions on efficiency. Take a break from reading by testing yourself. Could show areas for further study.

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