Answer
Market Failure can be attributed to the presence of externalities (negative and/or positive) and the provision of public goods.
An example of negative externalities occurs when firm that produces steel discharges its pollutants into the air.
An example of provision of public good is the providing street lamps on the street.
Work Step by Step
Market failure occurs due to inefficiency in the allocation of goods and services.
Presence of externalities: Market failure occurs because the market mechanism is not able to achieve an efficient allocation of resources
Provision of public good: The market fails as it is impossible to charge a market price for this good.
