Complete the statement. Allocative efficiency occurs when __ we cannot produce more of any good without giving up some other good marginal cost is minimized marginal benefit exceeds marginal cost we are producing at a point on the PPF such that marginal benefit at the quantity produced equals marginal cost

## Step 1<br />Allocative efficiency is a concept in economics that refers to the optimal distribution of goods and services in a society. This is achieved when the goods and services are distributed in a way that maximizes the satisfaction of consumers.<br /><br />## Step 2<br />The condition for allocative efficiency is that the marginal benefit of a good or service is equal to the marginal cost of producing it. This means that the cost of producing an additional unit of a good or service is equal to the benefit that consumers get from consuming that additional unit.<br /><br />## Step 3<br />This condition is represented graphically on the Production Possibility Frontier (PPF). The PPF is a curve that shows the maximum possible output combinations of two goods or services an economy can achieve when all resources are fully and efficiently utilized.<br /><br />## Step 4<br />In the context of allocative efficiency, the point on the PPF where the marginal benefit equals the marginal cost is the point of allocative efficiency. This is because at this point, the resources are being used in the most efficient way possible to produce goods and services that provide the highest level of satisfaction to consumers.