A Level Economics:

[Isaac CKR]

I would like to know why : The point of allocative efficiency is deemed to exist when the price of a product is equal to its MC.

 

[TheZodiac]

I would like to know why : The point of allocative efficiency is deemed to exist when the price of a product is equal to its MC.

This basically depends on the type of market structure a firm is operating in. In case of Imperfect market structure, point of allocative efficiency would not exist under any circumstances as the producer in an imperfect market would always prefer to produce at the profit maximizing level of output, which is MC = MR.

This would be true in case of both short-run and in the long-run as the producers would never tend to produce at allocative efficiency which is MC = AR until the government subsidies the firm (which is a totally different case)

However, in case of perfect market structure, the allocative efficiency is achieved in case of long run, as in the long run, the firm is earns normal profit.
Graphically, this can be proven:

Now we can see that both in abnormal profit and loss, which occur in short-run, the firm does not achieve allocative efficiency, however, in the long run, the firm is indeed allocative and productive efficient which means it's economically efficient.
So conclusively, we can say that the firm would only be allocative efficient in case in long run in the perfect market structure.

I hope it helps.

 

[Daniel X]

Is there any website or link where I can download the AS and A level economics book or CD ROM ?Please help me.

 

[Daniel X]

Is there any website or link where I can download the AS and A level economics book or CD ROM ?Please help me.

 

[Daniel X]

Is there any website or link where I can download the AS and A level economics book or CD ROM ?Please help me.

 

[Daniel X]

Is there any website or link where I can download the AS and A level economics book or CD ROM ?Please help me.

 

[Qamar Baloch]

• Result for Nov 2013 attempt is going to be announced on 24th Jan 2014. I wish all of you very best of luck!

 

[Qamar Baloch]

Just 11 days left

 

[Daniel X]

I think 22nd.

 

[Qamar Baloch]

I think 22nd.

no dear recheck
its on 24th jan

 

[rjcooo1]

Does anyone have the TOPICAL past paper questions for A2 economics for easier revision. It would be of great help.

 

[AlphaBeta]

Does anyone have the TOPICAL past paper questions for A2 economics for easier revision. It would be of great help.

u needto buy it .....no softcopies

 

[rjcooo1]

Are they available in India and if so where?

 

[rjcooo1]

Are they available in India and if so where?

 

[abdul razzaque]

please upload oct/nov 2013 9708/32 answers.
u have uploaded paper 12 answers but u did not uploaded paper 32 answers.
please upload it as soon as possible

 

[Qamar Baloch]

please upload oct/nov 2013 9708/32 answers.
u have uploaded paper 12 answers but u did not uploaded paper 32 answers.
please upload it as soon as possible

Ok dear will try to do it fast

 

[abdul razzaque]

Ok dear will try to do it fast

sir if u have the papers then please make it a little quick if possible
thanks
best regards

 

[Qamar Baloch]

sir if u have the papers then please make it a little quick if possible
thanks
best regards

OK DEAR
TAKING CLASS AT SKYP
WILLDO SOON

 

[rjcooo1]

Ok dear will try to do it fast

Mr. Qamar are your books available in india?

 

[muzirox]

AOA, Sir Qamar Baloch can u plzz explain the concept of substitute and income effect.