Allocative efficiency can be defined as
A)all non-value activities performed with minimal quantities needed to produce the given outputs.
B)elimination of all non-value-added activities.
C)input prices determining the relative proportions of each input that should be used.
D)input prices determining the relative proportions of each output that should be produced.

Question

Quizplus · Accepted Answer

Allocative efficiency occurs when resources are allocated in a way that the proportions of inputs used reflect their relative costs or prices, ensuring that the mix of goods and services produced matches consumer preferences and the inputs' prices.

Allocative Efficiency Can Be Defined as