Question

After long-run adjustments, a purely competitive market achieves Group of answer choices productive efficiency but not necessarily allocative efficiency. allocative efficiency but not necessarily productive efficiency. either productive efficiency or allocative efficiency, but not both. both productive and allocative efficiency.

Answer 1

Answer: both productive and allocative efficiency.

Explanation:

A purely competitive market, is a market where there are large numbers of firms which produces standardized product. The prices of the goods in the market are determined by the consumer demand and no supplier can influence the market price.

After long-run adjustments, a purely competitive market achieves both productive and allocative efficiency. This is due to the fact that the average variable cost will be minimized and thenoruce that's charged will be equal to the marginal cost.