Which of the following would be an example of government intervention to correct a market failure caused by buyers having inadequate information about sellers?
A) providing unemployment compensation insurance
B) sponsoring legislation to reduce pollution
C) licensing of medical doctors and surgeons
D) requiring all car drivers to buy auto insurance

Question

Quizplus · Accepted Answer

Licensing of medical doctors and surgeons is an example of government intervention to correct market failure caused by buyers having inadequate information about sellers. In this case, the government is ensuring that medical professionals have met specific standards before they are allowed to practice, thereby reducing the information asymmetry between doctors and patients. Options A, B, and D are not related to buyer-seller information asymmetry.

Which of the Following Would Be an Example of Government