Since Externalities Tend to Keep Markets from Reaching a Socially

question 395

Multiple Choice

Since externalities tend to keep markets from reaching a socially optimal equilibrium, government action

• A)is always needed because private solutions can never be attained.
• B)is needed when private solutions fail to arise.
• C)will be needed only to correct for positive externalities.
• D)will be needed only to correct for negative externalities.