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AP® Microeconomics

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Moderate

Allocatively Efficient Market

APMICR-GSXXHK

Which of the following must be true for a market to be allocatively efficient?

A

The price must be greater than the marginal cost.

B

The market must be monopolistically competitive.

C

The total consumer and producer surplus must be maximized.

D

The firms in the market must be price searchers/makers.

E

The markets must be producing the product at the lowest average cost.