Which of the Following Statements Describes a Similarity Between Markets

question 109

Multiple Choice

Which of the following statements describes a similarity between markets for common resources and markets with externalities?

• A)The equilibrium quantity is too high.
• B)The price that competitive firms charge does not capture the true costs and benefits of consumption.
• C)Government involvement is needed in order to reach an efficient outcome.
• D)Generally, the good or service is oversupplied in the market.

---

Definitions:

Hypotheses Testing

A method of statistical inference used to decide whether there is enough evidence in a sample of data to support a particular belief or hypothesis about a population parameter.

r Values

Statistical measures representing correlation coefficients that indicate the strength and direction of a linear relationship between two variables.

Spearman Rank-Correlation

A nonparametric measure of rank correlation that assesses how well the relationship between two variables can be described by a monotonic function.

Rejection Region

The rejection region is a concept in hypothesis testing that represents the set of values for which the null hypothesis is considered not likely to be true and is therefore rejected.