Cover each concept in a paragraph. Relate each concept to accountancy. Reach out in case you need help.
1. Explain the four causes of market failure in the society’s supply and demand for accounting information.
2. Explain the remedies, private and governmental, to each of these causes. Make sure you bring in the PCAOB somewhere or somehow in your essay.
3. Discuss how this case plays out in the context of the quality (and quantity) of accounting information we discussed. In particular, discuss how moral hazard and adverse selection portrayed by this case. More importantly highlight how government regulations attempt to reduce information asymmetry in this case.