Which concept refers to achieving production at the lowest cost per unit of output?

The concept that refers to achieving production at the lowest cost per unit of output is productive efficiency. This occurs when a firm produces goods or services at the minimum average cost. To reach this point, a firm must utilize its resources in such a way that it cannot produce more of one good without producing less of another, which typically corresponds to operating at the lowest point on the average cost curve. In conditions of productive efficiency, all the factors of production are being used optimally, minimizing waste and lowering cost per unit. This concept is crucial for firms in competitive markets as it helps them maintain profitability and sustainability.

Understanding this concept is essential for recognizing how firms operate in the short run and long run, particularly regarding their cost structures and production capabilities. Other concepts such as marginal revenue, allocative efficiency, and break-even price relate to different aspects of economic efficiency and profitability, but they do not specifically focus on minimizing per-unit production costs.