Market Failures

question 333

Multiple Choice

Market failures

• A) prevent the price system from attaining economic efficiency.
• B) result in quantities and prices that are socially desirable.
• C) strengthen economic efficiency by forcing unprofitable firms to close.
• D) weaken the argument for government intervention in the economy.

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Definitions:

Quadratic Relationship

A type of relationship between two variables where the relationship can be described by a second-degree polynomial or equation.

Significance Level

The threshold under which a result of a statistical test is considered statistically significant, often denoted by alpha (α).

Independent Variable

A variable that is manipulated to observe its effect on a dependent variable, considered the cause in cause-and-effect relationships.

Positive and Significant

A description of statistical results indicating that an effect or difference is both greater than zero and statistically unlikely to be due to chance alone.