Micro 8.2 0.0 / 5 ? EconomicsThe Meaning of Market FailureA2/A-levelAQA Created by: neve.whinnCreated on: 17-03-20 20:34 When does market failure occur? When the free market leads to a misallocation of resources in an economy. 1 of 5 When else does market failure occur? When a market fails to achieve productive efficiency, allocative efficiency or equity. 2 of 5 When does complete market failure occur? When the free market fails to create a market for a good or service, i.e. a missing market. 3 of 5 What is an example of complete market failure? Lighthouses, as everybody would have an incentive to wait for somebody else to provide them. 4 of 5 When does partial market failure arise? When a market exists, but does not provide resources in the optimum quantities to maximise economic welfare. 5 of 5
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