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Author Question: A free-market economy with perfect allocative efficiency does not exist in reality. Why? (Read 92 times)

booty5

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on: Oct 12, 2022
A free-market economy with perfect allocative efficiency does not exist in reality. Why?
◦ The assumption of utility maximization is not a realistic assumption about the behaviour of consumers.
◦ Government intervention in the economy prevents the economic forces that would eventually bring the market to an allocatively efficient outcome.
◦ The decentralization of economic power in a free-market economy does not allow for allocative efficiency.
◦ Firms in many industries have some degree of market power and face negatively sloped demand curves, and produce a level of output where P > MC.
◦ The assumption of profit-maximization is not a realistic assumption about the behaviour of firms.
Microeconomics ¦ Ragan ¦ 17th Edition
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Marked as best answer by booty5 on Oct 12, 2022

fowlerhop@rocketmail.com

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Reply #1 on: Oct 12, 2022
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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booty5

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Reply 2 on: Oct 12, 2022
Great answer, keep it coming :)

Liddy

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Reply 3 on: Yesterday
Gracias!

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