Final answer:
Tony's offer of more money for the skis on Craigslist is an example of c. allocative efficiency.
Step-by-step explanation:
Allocative efficiency means that among the points on the production possibility frontier, the chosen point is socially preferred at least in a particular and specific sense. In this case, Tony's offer of more money for the skis on Craigslist is an example of allocative efficiency. By offering more money, Tony is indicating that he values the skis more than the other potential buyers, and the seller is allocating the skis to the person who values them most.
Thus, allocative efficiency is used in economics to assess the optimal allocation of resources in the production of goods and services. It occurs when the quantity of each good produced aligns with consumer preferences, ensuring that the overall distribution maximizes societal welfare by equating the marginal benefit to the marginal cost.