There Is No Market Failure If

question 143

Multiple Choice

There is no market failure if

• A)the marginal private cost curve is upward sloping.
• B)the demand curve (for a good or service)is downward sloping.
• C)the demand curve lies about the marginal private cost curve.
• D)marginal private costs are greater than the external costs associated with a negative externality.
• E)the market provides the idea or socially optimal amount of a good.

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Definitions:

Asset Account

This refers to any account on a company's balance sheet that represents a tangible or intangible resource owned by the company that has economic value.

Liquid Accounts

Refers to financial accounts which hold assets that can be readily converted into cash, often with little to no loss in value, such as savings accounts or money market accounts.

Profitability Ratios

Financial metrics used to evaluate a company's ability to generate profit relative to its revenue, assets, equity, or other financial metrics.

Net Income

The total profit of a company after all expenses and taxes have been deducted from total revenues; also known as net earnings or net profit.