Which of the following is an example of an undesirable side effect of the operation of the market mechanism?
A)Negative externalities
B)Comparative advantages
C)Abstractions
D)Productivity growth

Question

Quizplus · Accepted Answer

Negative externalities, such as pollution or traffic congestion, are examples of undesirable side effects of the market mechanism. These are unintended costs imposed on society as a whole as a result of market transactions, and are not reflected in the prices of goods and services. As a result, the market mechanism does not fully take into account the societal costs of production and consumption, leading to market failures. Comparative advantages, abstractions, and productivity growth are not examples of unwanted side effects of the market mechanism.

Which of the Following Is an Example of an Undesirable