What are the four major sources of market failure? Explain briefly why each prevents the competitive market from operating efficiently. The four major sources of market failure are A. market power, incomplete information, externalities, and public goods. B. excess supply, excess demand, complete information, and externalities. C. market power, the government, externalities, and private goods. D. competition, symmetric information, externalities, and public goods. E. market power, incomplete information, surpluses, and shortages. Market power may prevent competitive markets from operating efficiently because O A. unions may provide labor where employment is maximized. B. monopolies may provide output where marginal revenue is less than marginal cost. C. unions may provide labor where unemployment is minimized. D. monopolies may provide output where price is equal to marginal revenue. E. monopolies may provide output where price is greater than marginal cost. O O O

What are the four major sources of market failure? Explain briefly why each prevents the competitive market from operating efficiently. The four major sources of market failure are A. market power, incomplete information, externalities, and public goods. B. excess supply, excess demand, complete information, and externalities. C. market power, the government, externalities, and private goods. D. competition, symmetric information, externalities, and public goods. E. market power, incomplete information, surpluses, and shortages. Market power may prevent competitive markets from operating efficiently because O A. unions may provide labor where employment is maximized. B. monopolies may provide output where marginal revenue is less than marginal cost. C. unions may provide labor where unemployment is minimized. D. monopolies may provide output where price is equal to marginal revenue. E. monopolies may provide output where price is greater than marginal cost. O O O

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Chose one: If there are no externalities a competitive market achieves economic efficiency. If there is anegative externality, economic efficiency will not be achieved because a. too much of the good will be produced. b.a deadweight loss will occur that is equal to the area under the demand curve for the good. c.too little of the good will be produced. d.economic surplus is maximized
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