Wednesday, August 06, 2008
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Banned
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Join Date: Apr 2008
Location: Alone
Posts: 590
Thanks: 768
Thanked 286 Times in 200 Posts
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X
- X-EFFICIENCY
- Producing OUTPUT at the minimum possible cost. This is not enough to ensure the best sort of economic EFFICIENCY, which maximises society’s total CONSUMER plus PRODUCER SURPLUS, because the quantity of output produced may not be ideal. For instance, a MONOPOLY can be an X-efficient producer, but in order to maximise its PROFIT it may produce a different quantity of output than there would be in a surplus-maximising market with PERFECT COMPETITION.
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