Which of the following best describes a major concern with the government's bailout of failing industries?
A) Unknown effect on market efficiency
B) Increases the likelihood of abnormal profits
C) Reduces the incentive for price manipulation
D) Encouraging participation by primary dealers
E) There is no concern

Question

Quizplus · Accepted Answer

Bailouts can distort market efficiency by potentially rewarding poorly managed companies and disrupting the natural selection process of the free market, where only the most efficient and innovative companies survive.

Which of the Following Best Describes a Major Concern with the Government's