In View of the Possible Need for Government Action in Markets

Multiple Choice

In view of the possible need for government action in markets where asymmetric information is a problem,which of the following is a valid concern?

A) The government almost always has more information than the private parties.
B) Private markets have no means of dealing with information asymmetries on their own.
C) The government is itself an imperfect institution.
D) Legally, the government can rarely intervene in markets.