An External Benefit Is A

question 53

Multiple Choice

An external benefit is a:

• A)negative externality.
• B)benefit that accrues to domestic firms as a result of the actions of foreign (external)firms.
• C)benefit that accrues to foreign (external)firms as a result of the actions of domestic firms.
• D)benefit that individuals or firms confer on others without receiving compensation.

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Definitions:

Marginal Revenue

The rise in income generated by selling an extra unit of a product or service.

Maximizing Profit

The process of making business decisions that increase a firm's earnings to its highest possible level.

Total Revenue

The total income a business receives from selling its goods or services, calculated by multiplying the price per unit by the number of units sold.

Competitive Firm

A company that operates in a market with many other firms, selling similar or identical products or services, where no single firm can influence market prices.