Map co sapling leag Despite the power of markets to allocate scarce resources, m
ID: 2498400 • Letter: M
Question
Map co sapling leag Despite the power of markets to allocate scarce resources, markets are not perfect. Economists have demonstrated that when there are externalities, public goods, monopolies, or missing markets, govermment intervention may be able to improve social welfare. In thinking about how to summarize the effect of government intervention and efficiency, sort the items into the correct box below. True False Government intervention always results in a decrease in social welfare. Though markets may result in some inefficiencies, governnent intervention will only make things worse vernment intervention sometimes Government intervention , decreases and sometimes increases efficiency always results in an welfare. Because of market failures, it is clear · 1n cases where market outcomes are that government needs to be involved inefficient, it may possible for government in all markets to ensure the efficient outcome.intervention to improve efficiency Government intervention with taxes and subsidies always reduces social welfare. O Previous Give Up & View Solution Check Answer Nex Ext HintExplanation / Answer
TRUE FALSE
Government intervention sometimes decrease Government intervention always results and sometime increases efficiency in a decrease in social welfare
Because of market failures, it is clear that government Though markets may result in some needs to be involved in all markets to ensure the inefficiencies. government intervention will efficient outcome. Only make things worse
Government intervention with taxes and subsidies in cases where market outcomes are inefficient
Always reduces social welfare it may possible for government intervention to
Government intervention always results Improve efficiency
In an increase in social welfare.