Which of the following is true?

Both of 1 and 2 are correct

OPTION 1- If by using less resources (i.e., the inputs) more benefits are derived (i.e., the outputs) then efficiency is said to be increased.
OPTION 2-Efficiency is increased when for the same benefit or outputs, fewer resources are used and less costs are incurred.
OPTION 3- If by using less resources (i.e., the inputs) more benefits are derived (i.e., the outputs) then effectiveness is said to be increased.

Efficiency means doing the task correctly and with minimum cost. There is a kind of cost-benefit analysis involved and the relationship between inputs and outputs. If by using less resources (i.e., the inputs) more benefits are derived (i.e., the outputs) then efficiency has increased. Efficiency is also increased when for the same benefit or outputs, fewer resources are used and less costs are incurred. Thus option 3 is incorrect.