Economists suggest that a market can fail if
A)production or consumption can harm an innocent third party.
B)consumers have to pay more than they want to.
C)producers get smaller profits than they desire.
D)governments dictate prices.

Question

Quizplus · Accepted Answer

Economists call this a negative externality, where the production or consumption of a good or service harms someone who is not involved in the transaction. This can include pollution or noise produced by a factory that affects nearby residents, for example. When left unchecked, negative externalities can result in market failure.

Economists Suggest That a Market Can Fail If