Allocative efficiency occurs when the
A)minimum of average total cost equals average revenue.
B)minimum of average total cost equals marginal revenue.
C)marginal cost equals the marginal benefit to society.
D)marginal revenue equals marginal benefit to society.

Question

Quizplus · Accepted Answer

Allocative efficiency is achieved when the marginal cost of producing a good or service equals the marginal benefit to society, indicating that resources are being allocated in the most efficient way to meet the needs and wants of society.

Allocative Efficiency Occurs When the