Pareto Efficiency is an economic concept that describes a situation where resources are allocated in the most efficient way possible. In this state, it is impossible to make one individual better off without making someone else worse off. This means that any change to improve one person's situation would negatively impact another's, indicating that resources are optimally distributed. In practical terms, achieving Pareto Efficiency does not necessarily mean that resources are distributed equally or fairly. It simply means that no further improvements can be made without harming someone else. This concept is often used in economics, game theory, and welfare economics to analyze resource allocation and social welfare.