In a purely competitive market, there is a triple equality. What is it? The triple equality...
In a purely competitive market, there is a triple equality. What is it? The triple equality can be broken up into two equations that each signify a difference efficiency. What are these efficiencies? Why are they important?
Homework Answers
Triple equality means P = MC = AC.
Equilibrium in the market is established through the demand and supply forces in the market.
Hence, Triple equality can be broken into two efficiencies. First is called economic efficiency and the second is known as productive efficiency.
Economic efficiency: it is achieved where P = MC.
Productive efficiency: it is achieved where the output of the firm corresponds to the minimum level of AC.
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In a purely competitive market, there is a triple equality. What
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