Efficiency Flashcards
1
Q
Productive efficiency
A
Producing at the lowest point of the average cost
2
Q
Allocative efficiency
A
the allocation of resources that maximise consumer welfare. associated with price = marginal cost
3
Q
Pareto optimum
A
A situation where nobody can be made any better off without somebody being made worse off
4
Q
Static efficiency
A
Being productively / allocatively efficient at a given moment time
5
Q
Technical efficiency
A
Producing the maximum possible amount of output from a given level of inputs
6
Q
X efficiency
A
Difference between technical efficiency and the performance of the firm that has little incentive to reduce units.
7
Q
Dynamic efficiency
A
Becoming more productively efficient over time. usually as a result of investment.
