Government failure occurs when
A) intervention by the government in the market fails to provide the socially optimal quantity of goods produced
B) the government fails to intervene in a market that has sizable externalities
C) the government fails to protect the free market and is forced to nationalize
D) the government must intervene in a market to provide the socially optimal quantity of goods
E) the government imposes a tax when it should have used an obligatory control

Question

Quizplus · Accepted Answer

Government failure occurs when government intervention leads to an inefficient allocation of resources, failing to achieve the socially optimal quantity of goods.

Government Failure Occurs When