A Negative Externality Exists If

question 134

Multiple Choice

A negative externality exists if

• A)there are price controls in a market.
• B)there are quantity controls in a market.
• C)the marginal social cost of producing a good or service exceeds the private cost.
• D)the marginal private cost of producing a good or service exceeds the social cost.

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Definitions:

Sensory Interaction

The principle that one sense can influence or interact with another; the interaction of the senses to enhance the perception of the world.

Moon Illusion

A perceptual phenomenon in which the Moon appears larger near the horizon than it does higher up in the sky.

Horizon

The line where the earth's surface and the sky appear to meet, often used metaphorically to denote the limit of a person's knowledge, experience, or interest.

Bright

Having high intelligence or quick intellectual capacity.