Final answer:
When there are more than two options, majority rule can fail to produce a clear outcome due to cyclical preferences known as the Condorcet paradox.
Step-by-step explanation:
True: Majority rule can indeed fail to produce a single preferred outcome when there are more than two choices. This phenomenon is known as a voting cycle or Condorcet paradox. For example, in a scenario where the majority prefers policy A over policy B, and policy B over policy C, but also prefers policy C over policy A, a cyclical pattern of preference emerges, preventing a clear majority preference from being established. This illustrates a situation where the majority rule is ineffective in reaching a conclusive outcome.