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Newer Mewer
on Dec 11, 2024

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Externalities cause the market mechanism to allocate goods and resources inefficiently because

A) nonconsenting third parties are generally not hurt by externalities.
B) producers and consumers ignore signals given by the competitive market.
C) prices are always higher than they should be.
D) competitive markets fail to give producers and consumers correct price signals.

Nonconsenting Third Parties

Individuals or groups affected by a transaction between other parties without their explicit agreement or participation.

Market Mechanism

The process by which supply and demand interact to determine the prices and quantities of goods and services in a market economy.

Allocate Goods

The process of distributing resources or products to where they are needed or can be used most effectively.

  • Determine the influence and function of externalities on the results of market activities.
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harrison terryDec 18, 2024
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