Based on our study of market failure and government failure, the main conclusion that one should arrive at is that
A) the market system is highly vulnerable to imperfections, and therefore the socialist system is a much better system to adopt.
B) the government has much imperfection and creates a lot of ineﬃciencies; therefore, it is best to adopt a pure market system.
C) it is best to always compare perfect markets against an idealized benevolent government that eﬃciently responds to the wants of society.
D) we must carefully compare the beneﬁts of government intervention in our markets against the costs of such intervention.

Question

Quizplus · Accepted Answer

The main conclusion one should arrive at from the study of market failure and government failure is that we must carefully compare the benefits of government intervention in our markets against the costs of such intervention. While markets are vulnerable to imperfections, government interventions can also create inefficiencies and unintended consequences. It is important to assess the costs and benefits of government action on a case by case basis and determine whether or not the benefits justify the costs. Therefore, option D is the best choice.

Based on Our Study of Market Failure and Government Failure