Question 13
[Maximum number: 1]
What is not a source of market failure?
A
imperfect information
B
income inequality
C
monopoly
D
non-excludability
CAIE A-Level Economics 7.3.6 Reasons for Market Failure
Practise identifying market failure from externalities, imperfect information, monopoly power, non-excludability and socially undesirable allocation while excluding distribution…
How this is tested
- classify external effects, imperfect information, monopoly and non-excludability as failure sources
- explain under-provision of socially desirable or public goods and overproduction of harmful goods
- distinguish income inequality or a firm's private loss from inefficient market allocation