how does advertising affect economic efficiency 
advertising can increase economic efficiency by supporting competition between different companies in the same market as businesses compete for consumers they may rely on advertisements to inform buyers of the best bargains and products if a business successfully attracts more customers through advertising it may be able to reduce its costs due to economies of scale however advertising can also have negative effects such as persuading consumers to buy overpriced products the bottom lineeconomic efficiency refers to the effective utilization of productive resources such as agricultural land manufacturing capacity raw materials or labor economists have several ways of measuring economic efficiency understanding and improving efficiency is one of the main objectives of economics 