Which of the Following Is Not a Market Failure

question 5

Multiple Choice

Which of the following is not a market failure?

• A) A lack of competition in some markets.
• B) Prices determined in competitive markets, which consumers, as individuals, have no control over.
• C) The presence of externalities in some markets.
• D) A lack of public goods desired by a majority of citizens.
• E) Income inequality.

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Definitions:

Cash Operating Expenses

Expenses that a company incurs during its day-to-day operations that require cash outflow.

After-Tax Discount Rate

The net discount rate that takes into account the tax implications affecting the net cost of investments or capital projects.

Working Capital

Working capital refers to the difference between a company's current assets and current liabilities. It is an indicator of a company's operational liquidity and short-term financial health.

After-Tax Discount Rate

A discount rate that has been adjusted to reflect the impact of taxes.