Which of the Following Statements About Market Failure Is Not

question 122

Multiple Choice

Which of the following statements about market failure is not true?

• A) Market failure causes an inefficient allocation of resources, even in a competitive market.
• B) Market failure can come from causes on the demand side or the supply side of a market.
• C) Market failure always results from some government action or policy in a market.
• D) Market failure can result from the number of sellers in a market being too few to ensure competition.

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Definitions:

Commerce Clause

A provision in the United States Constitution that empowers Congress to regulate commerce with foreign nations, and among the several states, and with the Indian tribes.

Federal Government

The national government of a federal country that shares power with states or provinces but has authority in matters of national concern.

Subject to Taxation

Describes income, goods, property, and other financial transactions that are considered taxable by the government.

Manufacturing Plant

A manufacturing plant is a large industrial facility where goods are produced through the combination of labor, machines, and processing of raw materials.