An inefficient allocation of resources will occur when:
A)decision makers are faced with the full costs and benefits of their actions.
B)there are clearly defined property rights.
C)no alternative exists that would increase the welfare of society.
D)decision makers are not faced with the full benefits and costs of their choices.

Question

Quizplus · Accepted Answer

If decision makers are not faced with the full benefits and costs of their choices, they may not be motivated to make the most efficient choice. This can lead to resources being allocated in a suboptimal way, resulting in an inefficient allocation of resources.

An Inefficient Allocation of Resources Will Occur When