When is a production method considered technically efficient?

Multiple choice question for Costs , Supply And Perfect Competition. Select an option, then review the explanation below.

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The output level is at its highest possible valueThe quantity of inputs used is at its lowestIt is impossible to produce the same output with fewer units of one input without increasing othersThe total expenses involved are at a minimum

Explanation

Technical efficiency occurs when it is not feasible to reduce the amount of one input without raising the usage of another input while maintaining the same output level.

Practice related questions from the same subject.

1.In the context of a perfectly competitive firm, what represents its short-run supply curve and its long-run supply curve respectively?
2.Under what condition will a firm cease production and produce nothing in the short term?
3.In the short run, the average total cost is composed of which two components?
4.What is the relationship between marginal cost and average cost when the average cost is decreasing and when it is increasing?
5.What does it indicate when the long-run average cost curve slopes downward from left to right?

When is a production method considered technically efficient?

Explanation

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