Respuesta :
Option (d) is Correct. Due to the difficulty private businesses will have in collecting payment for some commodities, such as fireworks displays, private marketplaces are unable to supply the ideal quantity.
Because public commodities are non-rival and non-excludable, private markets cannot produce the ideal amount of them. The advantage received by or cost incurred by a third party who is not directly involved in the production or consumption of a good or service is known as an externality. Lack of information, market regulation, public goods, and externalities can all contribute to market failure.
Government intervention, such as new laws, taxes, tariffs, subsidies, and trade restrictions, can be used to fix market failures. In terms of economics, market failure refers to a situation where there is an inefficient allocation of products and services on the open market. Summary: Because they are nonexcludable and do not have enforceable property rights, public goods are examples of market failures (nonrival). Due to lack of incentives, the private sector is unable to supply these commodities.
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Correct Question:
Private markets fail to provide the optimal amount of some goods, such as firework displays, because:
A- private companies cannot get permission to put on these displays
B- the competition would drive them out of business
C- these displays are dangerous, and private companies do not want the risk
D- private companies will have difficulty getting anybody to pay for them
