Costs to a Third Party from the Consumption of a Good

question 6

Multiple Choice

Costs to a third party from the consumption of a good is known as

• A)The scale effect
• B)A positive externality
• C)A negative externality
• D)Imperfect Information

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Definitions:

Perpetuity

A type of annuity that pays an infinite series of equal payments, with no end.

Regular Payments

Periodic payments made consistently over time, such as monthly mortgage or loan repayments, or dividend payouts to shareholders.

Capitalized

Expenses or costs that are added to the value of an asset and expensed over time through depreciation or amortization, rather than immediately.

Perpetuity

An annuity that pays a fixed amount of money for an infinite amount of time.