Which of the Following Is Not a Policy Implication of the Traditional

question 37

Multiple Choice

Which of the following is not a policy implication of the traditional model?

• A) For the most part, the government needs to stay out of people's way and let them trade.
• B) There is a potential role for government if there are positive externalities.
• C) The government should take moral and social incentives into account when considering intervention.
• D) There is a potential role for government if there are negative externalities.

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Definitions:

Temporary Working Capital

Working capital that supports seasonal peaks in business.

Seasonal Businesses

Companies that experience significant fluctuations in business activity due to seasonal factors such as holidays, weather, and consumer habits.

Customer Receivables

Money owed to a business by its customers for products or services delivered on credit.

Net Working Capital

The difference between a company's current assets and current liabilities.