Which statement is false concerning a market for a private good with no externalities or market power?

In a market for a private good characterized by the absence of externalities and market power, the dynamics primarily revolve around consumer choice, supply and demand, and private incentives. The correct assertion regarding government intervention highlights that in such a perfectly competitive market, intervention is not typically necessary for fostering competition since the market itself is structured to promote it.

Consumer choice being unrestricted shows that individuals can choose freely among products based on their preferences without artificial constraints. Prices in this market are indeed guided by the laws of supply and demand, meaning they will naturally fluctuate due to changes in consumer preferences or availability of goods. Lastly, production decisions in such markets are driven by private incentives, which means producers respond to consumer demands and potential profits effectively, opting to produce goods that are most desired by consumers.

The concept that government intervention can enhance competition does not apply in a perfectly competitive environment, where competition exists on its own merit. Instead of enhancing it, government intervention can sometimes lead to inefficiencies and unintended consequences, hindering the natural competitive forces of the market. Therefore, the false statement is the one suggesting that government intervention is beneficial in this context.