Which statement(s) is/are FALSE about market failures?
I. They arise in competitive markets.
II. They arise when information is available to all decision makers.
III. They arise when external costs are not considered in production decisions by producers.
A)I
B)I and II
C)III
D)I, II, and III

Question

Quizplus · Accepted Answer

Market failures do not necessarily arise in competitive markets, as monopolies can also be subject to market failures. However, they do arise when information is not available to all decision makers and when external costs are not considered in production decisions by producers. Therefore, statement I is false, and statements II and III are true, making option B the correct answer.

Which Statement(s) Is/are FALSE About Market Failures