When every good or service is produced up to the point where the last unit provides a marginal benefit to society equal to the marginal cost of producing it,________ occurs.
A)allocative efficiency
B)productive efficiency
C)equity
D)efficient central planning

Question

Quizplus · Accepted Answer

Allocative efficiency occurs when resources are allocated in the most efficient way possible, meaning that there is no waste in production and all goods and services are produced up to the point where the marginal benefit equals the marginal cost. This results in an optimal distribution of resources and maximizes social welfare.

When Every Good or Service Is Produced Up to the Point