Market failure occurs when
A) a good is too expensive for the market to provide.
B) an unrestrained market economy leads to too few or too many resources going to a specific economic activity.
C) one good is superior to another and drives it out of the market.
D) the stock market experiences a very large loss.
Answer: B
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Refer to the table above. Laborland has a(n) ________ advantage in ________ shoes
A) comparative; stitching B) absolute; designing C) absolute; stitching D) comparative; both designing and stitching
How are total and marginal utility related?
What will be an ideal response?
If you take out a mortgage with a nominal interest rate of 8% and you expect the inflation rate to be 2%, but the actual inflation rate turns out to be 8%, then you end up paying a real interest rate of
A) 0%. B) 1%. C) 2%. D) 6%.
Suppose that the world price of kiwi fruit ($10 per box) is below the domestic price ($12 per box). A tariff of $1 per box would:
a. cause foreign producers to be better off, because the price they charge is now higher by $1 per box. b. cause domestic producers to be worse off by $5 per box. c. allow domestic consumers to enjoy kiwi fruit for $5 more per box than the free trade price, but still $2 less than the domestic price. d. allow domestic consumers to enjoy kiwi fruit for $1 more per box than the free trade price, but still $1 less than the domestic price. e. cause domestic producers to be worse off by $10 per box.