The Existence of Imperfectly Competitive Firms Implies a Market Failure

Multiple Choice

The existence of imperfectly competitive firms implies a market failure because

A) they do not produce a productively efficient level of output.
B) their market power allows them to deceive consumers.
C) they lead to a socially undesirable distribution of income.
D) there is no way to prevent these firms from abusing their market power.
E) those firms will maximize profits by setting price above marginal cost.