When the absence of property rights causes a market failure, the government can potentially solve the problem
A)by clearly defining property rights.
B)through regulation.
C)by supplying the good itself.
D)All of the above are correct.

Question

Quizplus · Accepted Answer

The absence of clear property rights can result in a market failure where resources are not used efficiently. Governments can potentially solve this problem by clearly defining property rights through laws and regulations, regulating the market to ensure fair competition and prevent the exploitation of individuals or resources, or by supplying the good or service itself in cases where it is necessary for public welfare. Therefore, all of the above options can be effective in resolving market failures caused by the absence of property rights.

When the Absence of Property Rights Causes a Market Failure