Asked by Henriette Uwimbabazi on May 04, 2024
Verified
Market failure occurs when a market fails to produce efficient outcomes for society.
Market Failure
A scenario in which the distribution of goods and services through a free market fails to be efficient, typically resulting in a decrease in overall social welfare.
- Understand the notion of market inefficiencies and external effects.
Verified Answer
AC
Amelia CortezMay 09, 2024
Final Answer :
True
Explanation :
Market failure occurs when the market fails to allocate resources efficiently, resulting in a suboptimal outcome for society. This can happen due to externalities, public goods, imperfect competition, information asymmetry, and other factors.
Learning Objectives
- Understand the notion of market inefficiencies and external effects.