Question

Allocative efficiency is concerned with:

a) producing the combination of goods most desired by society.
b) achieving the full employment of all available resources.
c) producing every good with the least-cost combination of inputs.
d) reducing the concavity of the production possibilities curve.

Answer 1

The correct answer is option a.

Step-by-step explanation:

Allocative efficiency means that all the available resources are used to produce that provides maximum utility for the society or which is most desired by society.

The points on the production possibility frontier show efficiency. The process of efficiently allocating resources involves determining the combination of outputs that will provide maximum satisfaction or utility to the society and is actually attainable.