Which of the following does not indicate market failure?
A)Existence of monopolies.
B)Excessive air and water pollution.
C)A lack of such necessities as national defense.
D)Insufficient levels of research and development expenditures.
E)Severe income inequalities.

Question

Quizplus · Accepted Answer

Market failure refers to a situation where the allocation of goods and services by a free market is not efficient. Severe income inequalities, while often considered undesirable for a variety of social and economic reasons, do not in themselves indicate a failure in the market's ability to efficiently allocate resources. Instead, they reflect broader societal and economic structures and policies.

Which of the Following Does Not Indicate Market Failure