Allocatively efficient quantity is the quantity of goods produced where marginal benefit equals marginal cost. It represents an optimal allocation of resources in an economy.
Related terms
Marginal Benefit (MB): Marginal benefit refers to the additional benefit gained from consuming one extra unit of a good or service.
Marginal Cost (MC): Marginal cost refers to the additional cost incurred from producing one extra unit of a good or service.
Deadweight Loss: Deadweight loss represents the inefficiency in resource allocation caused by producing either too little or too much compared to allocative efficiency.