In a market system, which of the following is a symptom of market failure?
A) competition
B) scarcity of resources
C) falling prices
D) air pollution

Question

Quizplus · Accepted Answer

Air pollution is a negative externality - a cost imposed on society as a whole that is not reflected in the market price. This is a clear example of market failure, as the market does not take into account the negative effects of pollution on others. Competition and scarcity of resources are normal aspects of a market system, and falling prices can be a result of increased competition or changes in supply and demand.

In a Market System, Which of the Following Is a Symptom