When markets fail, which of the following is true?
A)Government intervention can always improve outcomes.
B)Government intervention can potentially improve outcomes.
C)Government intervention can never improve outcomes.
D)Markets do not fail.

Question

Quizplus · Accepted Answer

While government intervention does not always guarantee improvement in outcomes, it can potentially improve them in cases where markets are failing. This is because markets can have externalities, information asymmetries or imperfect competition, leading to market failure which can be corrected by government intervention. However, it is important to note that the type and extent of government intervention needed will vary depending on the situation.

When Markets Fail, Which of the Following Is True