A Positive Externality or External Benefit Occurs When

question 48

Multiple Choice

A positive externality or external benefit occurs when:

• A)product differentiation increases the variety of products available to consumers.
• B)the benefits associated with a product exceed those accruing to people who consume it.
• C)a firm produces at the P = MC output.
• D)economic profits are zero in the long run.

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Definitions:

Display Rules

Socially learned norms that dictate how and when emotions should be expressed in certain cultures or situations.

Stress Responses

Behavioral, mental, and/or physical responses to stressors.

Biological Systems

Complex networks of biologically relevant entities and processes that interact within living organisms to sustain life and enable function.

External Incentives

Rewards or punishments coming from the environment that influence behavior, such as money, praise, or penalties.