Market Failure occurs when:
Options
AMarket allocates resources efficiently
BMarket fails to allocate resources efficiently
CGovernment intervenes
DPrices range freely
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Public FinanceMTP - Dec 2023 (Inter)Question 132 of 20
All Questions Correct Answer
✅ Option b — Market fails to allocate resources efficiently
All Options:
- AMarket allocates resources efficiently
- BMarket fails to allocate resources efficiently
- CGovernment intervenes
- DPrices range freely
About This Chapter: Public Finance
Paper
Paper 4: Business Economics
Weightage
10%
Key Topics
Fiscal Policy, Budget, Market Failure
This chapter deals with government finances — how the government earns (taxation) and spends (expenditure) money. Key topics include Fiscal Policy, types of taxes (Direct and Indirect), the Union Budget, Public Debt, and the concept of Market Failure and how government intervention corrects it.
View Official ICAI SyllabusExam Strategy Tip
Focus on the difference between Revenue and Capital items in the budget. Understand Fiscal Deficit and its implications. Tax-related MCQs are commonly asked.
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