The Optimal Reduction of an Externality Occurs When

question 34

Multiple Choice

The optimal reduction of an externality occurs when:

• A)society's marginal cost of reducing that externality is greater than its marginal benefit.
• B)public agencies could make a great deal of money.
• C)society's marginal cost and marginal benefit of reducing that externality are equal.
• D)society's marginal benefit of reducing that externality is greater than its marginal cost.

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Definitions:

Frictional Unemployment

Short-term joblessness experienced by individuals transitioning between jobs or entering the workforce.

Unemployment Insurance

A government-provided benefit offering temporary financial assistance to workers who have lost their jobs through no fault of their own, to help cover living expenses.

Structural Unemployment

A type of joblessness resulting from a disparity between the abilities available in the workforce and the competencies required by businesses.

Manufacturing Jobs

Employment in industries that produce goods using labor and machines, typically within a factory or production facility.