When Negative Externalities Are Present, Market Failure Often Occurs Because

question 147

Multiple Choice

When negative externalities are present, market failure often occurs because:

• A) the cost borne by a third party not involved in the trade is not reflected in the market price.
• B) the cost borne by a third party not involved in the trade is reflected in the market price.
• C) the existence of imports from foreign countries takes jobs (and income) away from U.S. citizens.
• D) consumers will consume the good at a level at which their individual marginal benefits exceed the marginal costs borne by the firm producing the good.

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Definitions:

Loudness

A perceptual measure of the strength or intensity of a sound, usually measured in decibels, experienced by the listener.

Subtractive Colour Mixing

A process by which colors are produced, typically involving the mixing of colored pigments, where wavelengths are absorbed (subtracted), and the resulting color is a combination of the remaining wavelengths reflected.

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The process of placing or layering multiple sources of light over each other, often to achieve increased illumination or specific lighting effects.

Whiteness

A social construct referring to the set of cultural, historical, and social advantages and privileges that come with being identified as white.