In an economy with limited resources, what is the primary goal of resource allocation?

In an economy with limited resources, the primary goal of resource allocation is to use those resources in the most efficient way possible to meet the needs and wants of people. Since resources like money, time, and materials are not unlimited, we have to decide how best to distribute them to create the most benefits for everyone. For example, if a community has a limited budget for schools and roads, it must choose how much to spend on each to support education and transportation effectively. This careful decision-making helps ensure that essential services are provided while maximizing overall satisfaction. Ultimately, effective resource allocation helps improve the quality of life for everyone in the economy.