What Is a Market Failure

question 14

Multiple Choice

What is a market failure?

• A)It refers to the inability of the market to allocate resources efficiently up to the point where marginal social benefit equals marginal social cost.
• B)It refers to the inability of the market to allocate resources efficiently up to the point where marginal social benefit equals marginal private cost.
• C)It refers to a situation where an entire sector of the economy (for example, the airline industry)collapses because of some unforeseen event.
• D)It refers to a breakdown in a market economy because of widespread corruption in government.

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Definitions:

Labor Force

The labor force comprises all the working-age population who are currently employed and those who are unemployed but seeking employment.

Labor Force

Refers to the total number of people employed and unemployed, who are actively seeking work in an economy.

U.S. Governments

Refers to the federal government of the United States, including its three branches: the legislative, executive, and judicial branches.

Federal

Pertaining to the form of government or a system of governance that combines a central authority for the country with states or provinces that have their own governance, sharing sovereignty between the two.