Question 8 (0.05 points) \begin{tabular}{|l} Government intervention that moves production further away from the optimal \\ outcome is an example of a government failure. \\ True \\ False \end{tabular}

Government intervention can sometimes create inefficiencies, known as government failure, when the outcomes of such interventions lead to a misallocation of resources. For instance, subsidies meant to support a struggling industry may inadvertently stifle innovation and competition, ultimately creating a market more distant from what is considered optimal. A famous example of government failure occurred during the 1970s with price controls on gasoline in the U.S. While the intention was to protect consumers from rising prices, it led to shortages, long lines at gas stations, and black market activities. This demonstrates how well-meaning regulations can backfire and cause more harm than good!