A market failure could be caused by:
A) imperfect production.
B) imperfect competition.
C) many firms competing against each other for customers.
D) profit.

Question

Quizplus · Accepted Answer

Imperfect competition can lead to a market failure because there may not be enough competition to ensure that prices are set at the optimal level for both consumers and producers. This can result in lower output, higher prices, and reduced efficiency in the market. Imperfect production, many firms competing against each other for customers, and profit are not necessarily causes of market failure.

A Market Failure Could Be Caused By