Suppose the optimal amount of X is 100 units and that the market provides 123 units. This situation is descriptive of
A)externality provision.
B)market failure.
C)asymmetric information.
D)a public goods problem.
E)the free-rider dilemma.

Question

Quizplus · Accepted Answer

Market failure occurs when the allocation of goods and services by a free market is not efficient, in this case, producing more of a good (123 units) than is optimally required (100 units).

Suppose the Optimal Amount of X Is 100 Units and That