Saturday, April 12, 2008

Unit 2: Information failure: Food additives

This BBC clip explains that certain food additives are to be removed

http://news.bbc.co.uk/1/hi/health/7341481.stm

a) Explain the type of market failure represented by these food additives
b) Use a diagram to explain how the free market fails
c) What solutions are suggested? How successful do you think the voluntary ban would be? What benefits would come from a Europe wide ban?

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