Which of the Following Activities Would Most Likely Be Accounted

question 29

Multiple Choice

Which of the following activities would most likely be accounted for as a business-type activity?

• A) Fire protection.
• B) Recreation.
• C) Water operations.
• D) Street maintenance.

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Definitions:

Allocatively Inefficient

A situation where resources are not distributed in a way that maximizes the benefits to society, often leading to a loss of economic welfare.

Marginal Benefit

The additional satisfaction or utility gained from receiving or consuming one more unit of a good or service.

Marginal Cost

The cost of producing one additional unit of a product or service, a key concept in economic theory for decision-making and pricing.

Monopolists

Entities that are the sole providers of a product or service in a market, allowing them to control prices and output levels.