Which term refers to constraints on producing more of one good at the cost of reducing the production of another?

The term that refers to constraints on producing more of one good at the cost of reducing the production of another is known as "opportunity cost." While the choice identified as "efficient allocation" can pertain to how resources are managed effectively to maximize output, it does not directly address the trade-offs involved in production decisions.

Instead, the concept relates closely to the notion of trade-offs that arise due to limited resources. In economics, when you face the choice of increasing the production of one good, it typically involves reallocating resources—labor, capital, raw materials—from another good, culminating in a scenario where the output of one good is sacrificed for the additional output of another.

Thus, the context of production constraints emphasizes the relationships and limits inherent in resource availability when making economic choices. This principle is central to understanding the production possibilities frontier, where the trade-offs and maximum possible output combinations are graphically represented.

In summary, while efficient allocation focuses on the optimal use of resources, it does not specifically capture the intrinsic cost associated with shifting resources from one good to another as opportunity cost does.