Alternative institution for finding efficient economic

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1. "The Prime Directive in economics is the idea that the market efficiently allocates resources and goods and services among all possible uses, and also creates incentives that increase the standard of living for all people in an economy." Examine the validity of this statement and discuss some of the reasons that might make market outcomes inefficient or fail at times.

2. Explain why government is often seen as an alternative institution for finding efficient economic outcomes when markets fail and private solutions cannot be promoted. Can a government fail too? How and when? Use an example if you can.

Reference no: EM132443645

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