A Well-Maintained Waterfront Property That Is Enjoyed by Other Property

question 81

Multiple Choice

A well-maintained waterfront property that is enjoyed by other property owners is an example of

• A)an inefficient allocation of resources.
• B)a negative consumption externality.
• C)a positive consumption externality.
• D)a negative production externality.
• E)a positive production externality.

---

Definitions:

Capital Assets

Long-term property owned for investment or personal purposes, including stocks, bonds, real estate, and equipment.

IRC

The Internal Revenue Code, which is the comprehensive set of tax laws created by the Internal Revenue Service in the United States.

Personal or Investment Purposes

The intention behind acquiring or using property, either for personal enjoyment or to generate income or profit.

Preferential Tax Rates

Lower tax rates applied to specific types of income, such as capital gains or qualified dividends, which are taxed at a different rate than ordinary income.