Markets Fail to Allocate Resources Efficiently When

question 37

Multiple Choice

Markets fail to allocate resources efficiently when

• A)demanders and suppliers cannot agree on a price.
• B)goods are rival in consumption and excludable.
• C)property rights are not well established.
• D)too many buyers and sellers exist in the same market.

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Definitions:

Divergent Thinking

A thought process or method used to generate creative ideas by exploring many possible solutions.

Convergent Thinking

A thought process that attempts to focus on the single best solution to a problem.

Relativistic Thinking

Recognition that judgments are often not absolute but made from a certain belief system or cultural background.

Conventional Thinking

A mode of thought based on accepted norms and standards, often contrasted with creative or critical thinking approaches.