Efficiency is increased when for the same benefit or outputs _________.

Option 1 -> Using fewer resources and incurring less costs for the same output directly improves efficiency by optimizing resource utilization.

Option 2 -> Using fewer resources but incurring more costs is contradictory and does not improve efficiency as the cost per unit output increases.

Option 3 -> Using more resources with less costs is unusual and still represents inefficiency since more inputs are required for the same output.

Option 4 -> Using more resources and incurring more costs clearly reduces efficiency as it increases both input consumption and expenses for the same output level.

Hence, Option 1: fewer resources are used and less costs are incurred -> Efficiency is fundamentally about achieving the same (or greater) output while minimizing inputs. When fewer resources are consumed and lower costs are incurred for the same benefit or output, the input-output ratio improves, which is the definition of increased efficiency -> correct