Of the Following, Which Is the Best Example of an Externality

question 43

Multiple Choice

Of the following, which is the best example of an externality?

• A) a decision made by a U.S. company to move its operations overseas
• B) a decision by a company to fire undocumented workers
• C) the pollution that results from a firm's manufacturing process but for which the firm doesn't have to pay
• D) the share of a firm's profits that are donated to charities
• E) the share of a firm's profits that are paid out as dividends to stock holders

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Definitions:

Appendix

A small, tube-like appendage attached to the large intestine; often considered vestigial but may have roles in maintaining gut flora.

Mouth

The opening in the face of a human or animal, used for eating, breathing, and speaking.

Sexual Differentiation

The process by which the sexual organs and secondary sex characteristics develop differently in males and females, influenced by genetic and hormonal factors.

Trimester

One of the three roughly equal periods into which a pregnancy is divided, each lasting about three months.