The figure shows a firm which operates in
an imperfectly competitive industry.
Allocative efficiency is achieved where PMB
 = PMC. This occurs at an output level of
QA.
The firm produces the level of output which
maximizes profit. This occurs at QE since
this is where MR is equated to MC.
As a result, there is under production and
the associated welfare loss is shown by the
shaded triangle.
