When Market Failures Occur

question 291

Multiple Choice

When market failures occur

• A)the invisible hand will correct for the market failures.
• B)the price system will correct the market failures.
• C)people will reduce their consumption.
• D)the government can step in to correct the market failure.

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Definitions:

Impossibility

Impossibility describes a situation where an event or action cannot occur or be performed.

Convey Real Estate

The act of transferring title, ownership, and rights of real estate property from one party to another through a deed or legal document.

Nonperformance

The failure to act or fulfill one’s duties or obligations as agreed or required.

Liquidated Damages

A predetermined amount of money that must be paid as compensation for failure to perform under a contract, often found in legal agreements.