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Economics (AS & A Level) · Oct / Nov 2023 · Paper 31 · Question 8

9708Efficiency and market failure

How is dynamic efficiency represented on a diagram?

  1. Aa downward move to the minimum point of a long-run average cost curve
  2. Ba downward shift in the long-run average cost curve
  3. Ca move from a point inside a production possibility curve to a point on it
  4. Da reduction in marginal revenue so that it equals long-run marginal cost

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Correct answer: B. a downward shift in the long-run average cost curve

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