What term describes a situation in which the allocation of resources results in the highest level of overall satisfaction for society?

The term that describes a situation where resources are allocated in a way that maximizes overall satisfaction for society is called "Pareto efficiency. " In this situation, no one can be made better off without making someone else worse off. For example, imagine a small town where there are only two types of resources: food and shelter. If everyone has enough food and shelter, and any change to give more to one person would mean taking away from another, then the town is in a Pareto efficient state. This concept helps us understand how to use resources wisely to benefit the most people possible.