Economic efficiency involves three efficiency:
i) Efficiency in production: - Efficiency in
production means producing maximum possible amount of goods from the given
amount of resources.
ii) Efficiency in consumption: - Efficiency in
consumption means distribution of produced goods and services among the people
for consumption, in such a way as to maximize total satisfaction of society.
iii) Efficiency in the direction of production
i.e. overall economic efficiency: - Efficiency in the direction of production
means production of those goods which are most desired by the people.
