If many people in a community get flu shots, the whole community benefits including those that did not get flu shots. Therefore, not enough people may decide to get the shots. This is one illustration of:
A) The market allocating resources efficiently
B) Monopoly power due to lack of competition
C) Supply-side market failure
D) Demand-side market failure

Question

Quizplus · Accepted Answer

This is an example of a demand-side market failure, where individuals do not take into account the positive externalities they create for others by getting a flu shot. As a result, the optimal level of vaccination may not be achieved without intervention.

If Many People in a Community Get Flu Shots, the Whole