Allocative efficiency refers to a situation where
A)opportunity cost is zero for all goods.
B)marginal benefit is maximized.
C)opportunity costs are equal for all goods.
D)we cannot produce more of any one good without giving up some other good.
E)goods and services are produced at the lowest possible cost and in the quantities that provide the greatest possible benefit.

Question

Quizplus · Accepted Answer

Allocative efficiency occurs when resources are distributed in a way that maximizes the net benefit to society, meaning goods and services are produced at the lowest cost and in quantities that provide the greatest benefit. This involves producing the right mix of goods and services that reflect consumer preferences and societal values.

Allocative Efficiency Refers to a Situation Where