Dynamic efficiency focuses on changes in the choice available in a market together with the quality/performance of products that we buy. 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Learn more ›. Geoff Riley FRSA has been teaching Economics for over thirty years. A monopoly faces little or no competition. Therefore, it might be easy for the monopolist to make supernormal profits. This can be achieved through investment into production methods and innovation. West Yorkshire, Again this is probably because in perfect competition there is not incentive for individual firms to spend on research … Examples of Dynamic Efficiency • Dec 2015: Porsche to make electric sports car in €700m project - aimed at challenging Tesla's dominance of the battery-powered sports car market • Dec 2015: Ford says it will invest $4.5bn (£3bn) to expand its fleet of plug-in and hybrid electric vehicles, and will start selling 13 new electric models by 2020. In essence, it describes the productive efficiency of an economy (or firm) over time. Who were the world's most innovative companies in 2015? Individual teaching resources for delivering specific topics, including teaching instructions. A* Evaluation: Business Conduct and Efficiency A Level Microeconomics Revision 2019 Tutor2u Economics 2. tutor2u™ Supporting Teachers: Inspiring Students Page 6 of 7 Profits and Economic Efficiency www.tutor2u.net : The Home of Economics on the Internet Dynamic efficiency Dynamic efficiency occurs over time. Promoting efficient competition is also an important way in which dynamic efficiency is supported (however, I discuss this aspect specifically in relation to … 3. International competition: A firm may enjoy domestic monopoly power, but still face competition from overseas. Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory … Dynamic efficiency involves the introduction of new technology and working practices to reduce costs over time. An understanding of the 4 efficiencies that make up economic efficiency. Dynamic efficiency Dynamic efficiency occurs over time and is strongly linked to the pace of innovation within a market and improvements in the range of choice for consumers and the performance / reliability / quality of products. They can use for investment in new products condition is satisfied, total economic welfare is maximised of new and... 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