When the market does not lead to an optimal allocation of resources,there must be

Question

Quizplus · Accepted Answer

When the market fails to allocate resources efficiently, it is known as market failure. This can happen due to various reasons, such as externalities, public goods, asymmetric information, and market power. In such cases, government intervention or regulation may be required to improve the market outcome. Therefore, option B is the best choice. Options A, C, and D may or may not be relevant depending on the specific circumstances of the market failure.

When the Market Does Not Lead to an Optimal Allocation