ECONOMICS
CONSUMERS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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not being consumed by buyers who value it most highly.
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not distributed fairly among buyers
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not produced because buyers do not value it very highly.
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being produced with less than all available resources.
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Detailed explanation-1: -Under certain circumstances, firms in market economies may fail to produce efficiently. Inefficiency means that scarce resources are not being put to their best use.
Detailed explanation-2: -Market inefficiencies exist due to information asymmetries, transaction costs, market psychology, and human emotion, among other reasons. As a result, some assets may be over-or under-valued in the market, creating opportunities for excess profits.
Detailed explanation-3: -There are three main forms of market inefficiency. These are allocative, productive, and informational inefficiency. Deadweight loss refers to the loss of total surplus, or consumer and producer benefits, as the marginal costs do not equal the marginal benefits in an inefficient market.
Detailed explanation-4: -The concept of “efficiency” as used in economics is multi-faceted, as is shown in the chart below. First, a distinction is made between (a) efficiency in the production of goods and services and (b) (b) efficiency in the distribution of services from producers to end users. OVERALL PARETO. EFICIENCY IN THE. ECONOMY.