To be allocatively efficient the economy must be at the place on the production possibility curve that best meets consumers wants, where the combination of goods that consumers prefer is being produced.

Production Efficiency is any point on the PPC where all resources are being utilized.

Allocative Efficiency is a single point on the PPC. All resources are being utilzed and they they are being used as efficiently as possible. This means it is not possible to move away from this point without making someone worse off.

This is also the equilibrium point on the demand and supply diagram. All sectors of society are at their happiest.

This is where both consumer and producer surpluses are  MAXIMISED is where the economy is being allocatively efficient (they are gaining the maximum amount of benefit possible).

DEFINITION: Allocative efficiency is the point where both consumer and producer surpluses are maximised. Any movement away from this point will result in someone being worse off.

ANY MOVEMENT AWAY FROM ALLOCATIVE EFFICENCY WILL RESULT IN INEFFICIENCIES.
ANY INTERVENTION IN THE MARKET WILL CAUSE A LOSS IN ALLOCATIVE EFFICIENCY.

ANY LOSS IN ALLOCATIVE EFFICENCY MEANS THERE IS A DEADWEIGHT LOSS TO SOCIETY

A LOSS IN WELFARE DUE TO INEFFICIENT RESOURCE USE.