Suppose grapefruit is produced in a constant cost industry and sold in a perfectly competitive market. If the price for grapefruit is lower than the average cost of producing grapefruit, what can we say about the short run equilibrium?

• In short run equilibrium, firms will be both productively and allocatively efficient.
• In short run equilibrium, firms will be allocatively efficient.
• In short run equilibrium, firms will be neither productively nor allocatively efficient.
• In short run equilibrium, firms will be productively efficient.