A Market Failure Is Most Likely to Occur When

question 48

Multiple Choice

A market failure is most likely to occur when:

• A) a sole producer of a good faces no threat of competition.
• B) several producers of a good compete for customers by having price wars.
• C) several producers of a good search for the lowest-cost method of production.
• D) many producers produce identical products, and only the consumers are affected by the transactions.

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Definitions:

Business Market

The Business Market comprises organizations that acquire goods or services used in the production of other services or goods that are sold, rented, or supplied to others.

NAICS

The North American Industry Classification System, a standard used by Federal statistical agencies for classifying business establishments.

Economic Activity

Any action that involves the production, distribution, and consumption of goods and services within an economy.

Market Share

The percentage of an industry's sales that a particular company controls, indicating the company's size, competitiveness, and influence in the market.