When Positive Externalities Exist in the Consumption of a Good

question 149

Multiple Choice

When positive externalities exist in the consumption of a good, the marginal social benefit:

• A) equals the marginal benefit received by consumers of the good minus the marginal benefit to third parties.
• B) equals the marginal cost of producing the good plus the marginal cost to third parties.
• C) equals the marginal benefit received by consumers of the good plus the marginal benefit to third parties.
• D) could be either greater than or less than the marginal benefit received by consumers of the good depending on the equilibrium price determined in competitive markets.

---

Definitions:

Adoptive Siblings

Children who are not biologically related but become siblings through the process of adoption.

Reaction Range

The potential variability in the expression of a trait determined by genetic and environmental factors.

IQ Score

A numerical value derived from standardized tests designed to assess human intelligence and cognitive abilities.

Environmental Factors

External elements including climate, geography, natural resources, and cultural elements that affect living organisms and human health.