7) Efficiency is given by A. Actual output divided by design capacity B. Actual output divided by effective capacity C. Design capacity divided by utilization D. Effective capacity divided by actual output

The formula for Efficiency is given as the actual output divided by effective capacity.

Basically, an efficiency shows the relationship between the actual output and the effective capacity.

In other word, the efficiency refers to the actual output as a percentage of the efficient capacity that a firm can achieve.

Mathematically, an efficiency equals Actual output divided by effective capacity

Hence, the Actual output divided by effective capacity is the correct answer.

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B.  actual output divided by effective capacity.

Explanation:

The efficiency shows a relationship between the actual output and the input. It is shown as a ratio

In mathematically,

Efficiency = Actual output ÷ effective capacity

The motive is to determine the efficiency is to know how much it produced the number of units produced by reducing the wastage, cost, time, etc