Economics 9708 · AS & A Level · Behavioural economics

Behavioural economics — practice question

When the marginal cost of a good is below its price, allocative efficiency has not been reached. What is likely to correct this?

  • Aproduction of the good: decrease; price of the good: decrease
  • Bproduction of the good: decrease; price of the good: increase
  • Cproduction of the good: increase; price of the good: decrease
  • Dproduction of the good: increase; price of the good: increase

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