Asked by Isiwat Taiwo on May 28, 2024
Verified
Demand-side market failures occur when
A) demand curves don't reflect consumers' full willingness to pay for a good or service.
B) demand curves don't reflect the full cost of producing a good or service.
C) government imposes a tax on a good or service.
D) a good or service is not produced because no one wants it.
Demand-Side Market Failure
Occurs when demand in a market does not reflect the true value of a good or service, often due to externalities or information asymmetries.
Demand Curves
graphically represent the relationship between the price of a good and the quantity demanded by consumers at various prices.
- Assess market failures and the role of government in addressing them.
Verified Answer
LC
laury castrillonMay 31, 2024
Final Answer :
A
Explanation :
Demand-side market failures happen when the demand curve does not accurately represent consumers' full willingness to pay for a good or service, meaning the price does not reflect the true value to consumers.
Learning Objectives
- Assess market failures and the role of government in addressing them.