When the government fails to improve market outcomes it is known as a government failure. True False

Absolutely true! Government failure occurs when governmental intervention in the economy leads to inefficiencies, which ultimately results in a worse market outcome than if the government hadn't intervened at all. This can happen due to various reasons, such as misallocation of resources or lack of information, leading to outcomes that can stifle competition and innovation. For example, imagine a government subsidy designed to lower the cost of electric cars. If the subsidy is too high, it may encourage overproduction, leading to wasted resources and unintended consequences like increased pollution from over-capacity in battery production. It's all about striking the right balance to ensure government action truly benefits the market!