Question

Market failures​ ________ and generate​ ________. A. create monopolies or​ oligopolies; deadweight loss B. create deadweight​ loss; externalities C. compel the government to​ act; regulations D. reduce economic​ efficiency; deadweight loss

Answer 1

D. reduce economic​ efficiency; deadweight loss

Step-by-step explanation:

Market failures are produced when in a free market context, individual decisions for the allocance of resources is inefficient, and produces deadweight loss, an economic measure of social welfare. This situation justifies in some cases government interventions. The most common tools for intervention are taxes, subsidies or price regulation.