Allocative efficiency occurs when
A)consumer surplus is maximized.
B)deadweight loss is achieved.
C)producer surplus is maximized.
D)the economy achieves the frontier of the production possibilities boundary.
E)the sum of consumer and producer surplus is maximized.

Question

Quizplus · Accepted Answer

Allocative efficiency occurs when resources are distributed in a way that maximizes the total surplus, which is the sum of consumer and producer surplus.

Allocative Efficiency Occurs When