Homework answers / question archive / The term market failure refers to a

The term market failure refers to a

Marketing

Share With

The term market failure refers to

a. a situation in which the market on its own fails to allocate resources efficiently.

b. an unsuccessful advertising campaign that reduces demand for a product.

c. a situation in which competition among firms becomes ruthless.

d. a firm that is forced out of business because of losses.

pur-new-sol

Purchase A New Answer

Custom new solution created by our subject matter experts

GET A QUOTE

Answer Preview

The correct answer is (a). Failure to efficiently allocate resources by the market is known as market failure. In such an economic problem, every person develops the appropriate decision in their favor. However, those demonstrate incorrect choices for the entire group.