A firm operating in a perfectly competitive market is a price taker, with the market price of its product set at P=£48P = £48P=£48. The firm's total cost function is:
TC=2q2+8q+72 TC = 2q^2 + 8q + 72 TC=2q2+8q+72where q q\,q represents the quantity of output.
Which of the following options correctly identifies the levels of output q q\,q at which the firm achieves allocative efficiency and productive efficiency?
Allocative efficiency at q=10q = 10q=10; productive efficiency at q=6q = 6q=6
Allocative efficiency at q=6q = 6q=6; productive efficiency at q=10q = 10q=10
Allocative efficiency at q=18q = 18q=18; productive efficiency at q=6q = 6q=6
Allocative efficiency at q=20q = 20q=20; productive efficiency at q=6q = 6q=6
