If a Good Incurs a Negative Externality, Then the Socially

question 56

Multiple Choice

If a good incurs a negative externality, then the socially desirable output level can be reached by

• A)increasing the supply of the good.
• B)decreasing the supply of the good.
• C)increasing the demand for the good.
• D)subsidizing the consumption of the good.
• E)allowing the government to produce the good.

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Definitions:

Common Goal

An objective or target shared by a group, which guides collective efforts.

Productive Forgetting

The beneficial aspect of forgetting that allows individuals to discard irrelevant information to enhance learning and decision-making efficiency.

Extrinsic Motivation

Motivation driven by external rewards such as money, fame, grades, or praise, rather than internal factors like personal satisfaction or enjoyment of the task itself.

Cognitive Dissonance

The mental discomfort experienced by a person who holds two or more contradictory beliefs, ideas, or values at the same time.