At What Level of output is there Allocative Efficiency in the Economy?

Marginal Benefit is the additional benefit or utility a consumer derives when he or she consumes an additional unit of a good, this is also known as marginal utility. At the optimum level of consumption, the marginal utility is always equal to price (this is because if the price is less than the marginal utility the consumer continues consumption of that good; similarly, if the price is more than the marginal utility the consumer reduces consumption of that good).
So, at the optimum point of consumption the marginal utility is equal to the price. Thus, Allocative Efficiency occurs only at that level of output where the price of the good is equal to the marginal cost of producing the good faced by the producer.

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