When Market Failures Occur

question 346

Multiple Choice

When market failures occur,

• A) the invisible had 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:

Winding Up

The process of dissolving a company, including settling its debts and distributing any remaining assets to shareholders.

Dissolution

The process of formally ending or closing down a business or partnership.

Existing Contracts

Agreements that are currently in effect and have been established or agreed upon in the past between parties.

Compete

To strive for achieving something such as a prize or superiority, often through comparison or rivalry.