• Necessary vs. Sufficient Condition in Social Welfare: In welfare economics, allocative efficiency (Pareto optimality) is a necessary condition but not a sufficient condition to guarantee the maximization of social welfare:
• Necessary Condition: Social welfare cannot be at its global maximum if society is operating inside the production possibility frontier or off the contract curve, as moving to the utility possibility frontier can make at least one individual better off without making anyone worse off.
• Not Sufficient Condition: Pareto efficiency merely identifies an infinite continuum of optimal points along the Grand Utility Possibility Frontier ($GUPF$). A Pareto-efficient allocation can involve extreme inequality (e.g., one individual possessing 99% of total wealth). Determining the unique bliss point (maximum social welfare) requires normative ethical value judgments embodied in a Bergson-Samuelson Social Welfare Function ($W = W(U_A, U_B)$), making efficiency alone insufficient without equity.
• Distractors: Terms such as 'valid', 'invalid', and 'simultaneous' do not reflect formal logical criteria of economic optimality theorems.

Correct option: (1) Sufficient