1.If many people in a community install fire hydrants, the whole community benefits including those that did not install it. Therefore, not enough people may decide to install the fire hydrant. This is one illustration of:

A. The market allocating resources efficiently

B. Monopoly power due to lack of competition

C. Supply-side market failure

D. Demand-side market failure

2.When a private firm provides fireworks, it could not produce the efficient amount of it because it is unable to charge consumers who are unwilling to pay for it, then we have a:

A. Demand-side market failure

B. Supply-side market failure

C. Competitive market

D. Monopolistic market

3.When a chemical firm does not have to pay the full cost of producing a product, they tend to:

A. Over-produce the product because of a demand-side market failure

B. Under-produce the product because of a demand-side market failure

C. Under-produce the product because of a supply-side market failure

D. Over-produce the product because of a supply-side market failure