When market failures occur
A)the invisible hand will correct for the market failures.
B)the price system will correct the market failures.
C)people will reduce their consumption.
D)the government can step in to correct the market failure.

Question

Quizplus · Accepted Answer

Market failures occur when the free market fails to allocate resources efficiently. In these cases, the government may need to step in to correct the failure through regulation, taxation, or other interventions. The other choices (A, B, and C) do not necessarily address the specific causes or consequences of market failures.

When Market Failures Occur