In perfect competition, if firms produce where P=MC they ensure because the social benefits of production as measured by the price that people are willing to pay are in balance with the to society of that production.

In perfect competition, if firms produce where P=MC they ensure allocatives efficiency because the social benefits of production as measured by the price that people are willing to pay are in balance with the marginal costs to the society of that production.

Explanation:

In perfect competition, a market will be allocatively efficient as long as firm produces at the P=MC level of output. if consumer pay price for a product is greater than marginal cost to the firm of producing it, then the message being sent to producers is that more output is demanded. In pursuit of the profit, more resources will be allocated toward production of the product util marginal cost and prices are become equal. at this point (P=MC) firms maximize their profits and resources are said to be efficiently allocated.

In perfect competition, if firms produce where P=MC they ensure ________ because the social benefits of production as measured by the price that people are willing to pay are in balance with the ________ to society of that production.

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In perfect competition, if firms produce where P=MC they ensure because the social benefits of production as measured by the price that people are willing to pay are in balance with the to society of that production.