When Consuming a Good Creates Positive Externalities

question 38

Multiple Choice

When consuming a good creates positive externalities,

• A)private demand increases
• B)private demand decreases
• C)the private demand curve overstates the marginal social benefit of the good
• D)the private demand curve understates the marginal social benefit of the good
• E)the equilibrium quantity increases without government intervention

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Definitions:

Safeguard Inventory

Strategies and measures implemented by a company to protect its inventory from damage, theft, and other losses.

FOB Shipping Point

A term used in shipping indicating that the buyer is responsible for goods once they are shipped, and must cover transport costs.

Net Income

Net income is the total earnings of a company after deducting all expenses, taxes, and losses, indicating the company's profitability over a specific period.

Ending Inventory

The value of the goods available for sale at the end of an accounting period.