Allocative efficiency is achieved in an industry when firms supply those goods and services that provide consumers with a marginal benefit equal to the marginal cost of producing those goods and services.

Question

Quizplus · Accepted Answer

Allocative efficiency occurs when the marginal benefit of a good or service is equal to its marginal cost. This means that the resources of the industry are being used efficiently to produce the goods and services that are most desired by consumers.

Allocative Efficiency Is Achieved in an Industry When Firms Supply