Economics For Today
10th Edition
ISBN: 9781337613040
Author: Tucker
Publisher: Cengage Learning
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Chapter 4, Problem 20SQ
To determine
Which is not an example of the market failure.
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Name a type of market failure and explain why this market failure results in economic inefficiencies.
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Explain what is meant by market failure and outline the sources of market failure.
Chapter 4 Solutions
Economics For Today
Ch. 4.2 - Prob. 1YTECh. 4.2 - Prob. 2YTECh. 4.2 - Prob. 3YTECh. 4.2 - Prob. 4YTECh. 4.3 - Prob. 1YTECh. 4.3 - Prob. 2YTECh. 4 - Prob. 1SQPCh. 4 - Prob. 2SQPCh. 4 - Prob. 3SQPCh. 4 - Prob. 4SQP
Ch. 4 - Prob. 5SQPCh. 4 - Prob. 6SQPCh. 4 - Prob. 7SQPCh. 4 - Prob. 8SQPCh. 4 - Prob. 9SQPCh. 4 - Prob. 10SQPCh. 4 - Prob. 1SQCh. 4 - Prob. 2SQCh. 4 - Prob. 3SQCh. 4 - Prob. 4SQCh. 4 - Prob. 5SQCh. 4 - Prob. 6SQCh. 4 - Prob. 7SQCh. 4 - Prob. 8SQCh. 4 - Prob. 9SQCh. 4 - Prob. 10SQCh. 4 - Prob. 11SQCh. 4 - Prob. 12SQCh. 4 - Prob. 13SQCh. 4 - Prob. 14SQCh. 4 - Prob. 15SQCh. 4 - Prob. 16SQCh. 4 - Prob. 17SQCh. 4 - Prob. 18SQCh. 4 - Prob. 19SQCh. 4 - Prob. 20SQ
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- Which of the following represents a market failure? a) people prefer to have more restaurant meals so the price of dining out increases b) an airline increase ticket prices and fewer people choose to fly c) a market fails to produce enough luxury cars for everyone to own d) in a poor country, education is not subsidized by the government, so fewer children go to schoolarrow_forwardExplain the two causes of market failures. Given their definitions, could a market be affected by both types of market failures simultaneously?arrow_forwardThe chart above shows the market for polio vaccine in Pakistan. This vaccine provides external benefits because vaccinating one person reduces the likelihood of other people catching the disease. a.) If there is a competitive market and there is no government intervention, what will be the amount of vaccine? b. ) If a foundation takes over the cost of the vaccine, what will be the amount of vaccine used in the market? How will the market efficiency change? Why?arrow_forward
- What is the term used to describe the situation where resources are allocated in a way that maximizes total surplus? A. Pareto efficiency B. Market equilibrium C. Social welfare D. Deadweight lossarrow_forwardIdentify a type of market failure. Provide an example of that type of market failure and briefly explain one way that the government could help reduce the negative effect of that market failure.arrow_forwardWhat are three reasons that a government might want to intervene in markets?arrow_forward
- In the latter years of the command economy in the Soviet Union, there was some experimentation with private agriculture. At one point in the experiment, privately owned farms accounted for only three (3) percent of the cropland and yet produced twenty-seven (27) percent of the country's food. Use the concepts of efficiency, incentive, and quotas to explain how this situation could arise.arrow_forwardFor the scenarios below, identify the type of market failure, explain why it occurs and provide a solution: (1) An auto repair shop convinces you that you need a $20,000 valve job when all you need is an oil change. (2) Everyone in the neighbourhood would benefit if an empty lot were turned into a park but no entrepreneur will come forward to finance the transformation (3) A barking dog in the backyardarrow_forwardIn macroeconomics 1. List and explain the three ways in which there can be market failure. 2. Define externality and distinguish between positive and negative externality and their impact on production, using examples where possible. 3. How can a government correct for positive and negative externalities ? Give real life examplesarrow_forward
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