Which of the Following Is an Example of Government Failure?
Which of the following is an example of government failure?
A)Too much regulation resulting in wasted resources.
Regulation is appropriate if
A)Government failure exists.
B)Market failure exists and the benefits of regulation exceed the costs.
C)It improves market outcomes regardless of costs.
D)An economic profit is being earned.
In cost-benefit analysis,regulatory intervention can be justified if the
A)Marginal benefit of regulation exceeds its marginal cost.
B)Economic cost of regulation exceeds the value of the improvements in government intervention.
C)Value of government failure exceeds the value of market failure.
D)Intervention improves market outcomes,regardless of costs.
When there is market failure
A)Government intervention is always beneficial.
B)A laissez-faire approach is the best policy.
C)Government intervention is beneficial only in the case of natural monopolies.
D)Government intervention is beneficial only when the marginal benefit of intervention exceeds the marginal cost.