Economics 2281 · O Level · Market failure

Market failure — practice question

There is growing concern about the manner in which large firms exploit the environment. What is the principal reason for this concern?

  • ALarge firms are unprofitable because of diseconomies of scale.
  • BLarge firms combine together to fix prices.
  • CThe exploitation of resources is expensive.
  • DUnlimited wants will use up the finite resources.

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