If society has overallocated resources to a particular activity, then the marginal benefits of the activity would be less than the marginal costs.

Question

Quizplus · Accepted Answer

When resources are overallocated to an activity, it means too much is being spent or used on that activity relative to others, leading to a situation where the additional (marginal) benefits gained from the activity are less than the additional (marginal) costs incurred, indicating inefficiency in resource allocation.

If Society Has Overallocated Resources to a Particular Activity, Then