Allocative efficiency means that
A) the product is produced at the lowest unit-cost possible.
B) society's scarce resources are used to produce products that align with consumer preferences.
C) the product is sold at a price equal to the average cost of producing it.
D) the marginal benefit of the product exceeds its marginal cost.

Question

Quizplus · Accepted Answer

Allocative efficiency means that resources are allocated in a way that aligns with consumer preferences, meaning that goods and services that people value most are produced. It is not necessarily about producing at the lowest cost, selling at a certain price, or only producing goods with marginal benefit exceeding marginal cost.

Allocative Efficiency Means That