There are various forms of market failure, though it is commonly defined in economics as a situation where the distribution of goods and service are conducted in an inefficient manner.
In the case illustrated in the question, the form of market failure that is taking place occurs in the nature of the exchange, which is due to bounded rationality. It is defined as condition commonly occurring in individuals where decision-making is based on making a satisfactory solution instead of an optimal one – this leads to irrational behaviors. A good example is the tipping behavior provided in the question.
Thus, the answer to the question is (D) Yes this could be considered a form of market failure. If consumers and markets were rational tips would be based on the quality of service.
The reason why white collar criminals are able to carry out their crimes or schemes for a long period of time compared to those who has the same schemes as them because white collar criminals are different to other people, for they have high intellect and are ambitious to what they do, that is why they could escape from their schemes or hide them compared to those ordinary people who are caught an collapse in the early stage.
The true statement is Nation Alpha has a comparative advantage in producing chemicals. (second option)
<h3>What is comparative advantage?</h3>
A country has comparative advantage in production if it produces at a lower opportunity cost when compared to other countries. Opportunity cost is the cost of forgoing the next best alternative action when one activity is undertaken over other activities.
For Nation Beta:
Opportunity cost of producing chemicals : 800 / 1600 = 0.5
Opportunity cost of producing clothes : 1600 / 800 = 2
For Nation Beta:
Opportunity cost of producing chemicals : 200 / 800 = 0.25
Opportunity cost of producing clothes : 800 / 200 = 4
To learn more about comparative advantage, please check: brainly.com/question/25139916
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