Practice: Markets and Efficiency

______________ market structure leads to productive efficiency and a _______________ market structure leads to allocative efficiency.

Monopolistic, perfect competition

All, perfect competition

All, oligopoly

all, monopoly

I don't know

More Production and Allocative Efficiency Questions:

Suppose there are two companies burning coal to generate electricity. The electricity generated is sold to the consumers, however coal burned generates a lot of smog pollution.

The marginal costs of abatement for both firms are:

$MC_1=10Q_1$ and $MC_2=3Q_2+15$

allocative efficiency

In productive efficiency every firm at industry level has the same

Suppose there are two companies burning coal to generate electricity. The electricity generated is sold to the consumers, however coal burned generates a lot of smog pollution.

The marginal costs of abatement for both firms are:

$MC_1=10Q_1$ and $MC_2=3Q_2+15$