Question

As a function of government in a modern market economy, how MIGHT a government respond to a market failure?

A.) A government might allow businesses to act in their own self-interest
B.) A government might intervene in the market to reestablish efficiency.
C.) A government might persuade consumers to reduce demand.
D.) A government might discourage entrepreneurship.

Answer 1

B

Step-by-step explanation:

-3-

I know boiiiii

Answer 2

The answer is:

B.) A government might intervene in the market to reestablish efficiency.

Step-by-step explanation:

One good example is the recent financial crisis in the US and world markets due to the bankruptcy of private banks, the mortgage crisis of 2008. The US government was forced to rescue troubled institutions and apply corrective fiscal and macroeconomic measures. So did other governments.