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5 Cards in this Set
- Front
- Back
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Productive efficiency? |
Productive efficiency exists when production is achieved at lowest cost. |
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where does Allocative efficiency occur |
when consumers are able to buy the products they desire in the quantities they desire and with the quality they desire. |
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Dynamic efficiency ? |
Dynamic efficiency is concerned with how resources are allocated over a period of time. |
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Static Efficiency? |
Static efficiency exists at a point in time. E.g a firm could produce 1 million cars a year more cheaply by using more labour and less capital |
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Pareto efficiency? |
Pareto efficiency occurs when it is not possible to change the existing allocation of resources in such a way that someone is made better off without making someone else worse off |
