In long-run equilibrium, P = minimum ATC = MC. Of what significance for economic efficiency

Explanation
The price equals the minimum average total cost indicates the productive efficiency. The firm is using all the resources efficiently. The firm uses the lowest cost and advanced technologies. The equality of price and marginal cost implies allocative efficiency. The output produced by the firm is socially accepted. The firm is producing the right goods in the right process. The goods which are produced are the desired goods of the consumers.

In productive efficiency, the firm produces the least-cost combinations of products while the allocative efficiency indicates that the firm is producing the goods that the consumers desired. Thus, the produced output will be socially acceptable and the scarce resources will produce the goods that the society wants.

Verified Answer
When the price and the minimum average total cost become the same then it states that the productive efficiency is achieved by the firm.

When the price and the marginal cost become the same then it states that the allocative efficiency is achieved by the firm.

The productive efficiency states that the firm is producing at the lowest cost. However, allocative efficiency states that the firm is using the resources for producing socially desired goods and services.