Allocative Efficiency Calculator

Allocative Efficiency Calculator calculator can be used to determine how well resources are allocated by comparing marginal benefit to marginal cost.

Input Parameters

Calculation Results

Allocative Efficiency

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Where:
Allocative Efficiency = (Marginal Benefit / Marginal Cost) * 100%

Allocative Efficiency Calculator Calculator Usage Guide

Learn how to use the Allocative Efficiency Calculator calculator and its working principles

What is Allocative Efficiency?

Allocative efficiency occurs when resources are distributed in a way that maximizes the total net benefit to society. It is achieved when the marginal benefit of a good or service equals its marginal cost.

How to Use the Calculator

  1. Enter the marginal benefit in dollars.
  2. Enter the marginal cost in dollars.
  3. Click the "Calculate" button to compute the allocative efficiency.
  4. The result will be displayed as a percentage.

Interpreting the Results

An allocative efficiency of 100% indicates that resources are perfectly allocated, meaning the marginal benefit equals the marginal cost. A percentage below 100% suggests that resources are not optimally allocated, and a percentage above 100% indicates an over-allocation of resources.