An Externality Is

question 23

Multiple Choice

An externality is

• A) a cost or benefit resulting from some activity or transaction that is imposed or bestowed on parties outside the activity or transaction.
• B) the total cost to society of producing an additional unit of a good or service.
• C) the amount a consumer pays to consume an additional amount of a particular good.
• D) a problem intrinsic to public goods: The good or service is so costly that its provision generally does not depend on whether or not any single person pays.

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Definitions:

Scientific Method

A systematic and empirical approach to research, involving observation, hypothesis formulation, experimentation, and conclusion to gain or validate knowledge.

Careful Analysis

The thorough examination and evaluation of data or information to break it down into fundamental components for better understanding.

Hypothesis

A conjecture posited with restricted evidence, designed as an inception for additional study.

Ethical Standards

Principles that govern the conduct of individuals and organizations, promoting behaviors that are considered morally right and beneficial to society.