If an Externality Is Present in a Market, Economic Efficiency

question 6

Multiple Choice

If an externality is present in a market, economic efficiency may be enhanced by

• A)government intervention.
• B)a decrease in foreign competition.
• C)fewer market participants.
• D)weaker property rights.

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Definitions:

State Governments

The governing bodies of individual states within a federal system, which have powers to make and enforce laws within their jurisdictions under the U.S. Constitution.

Local Governments

Administrative bodies that govern smaller areas within a country, such as cities, towns, or counties, responsible for local services and regulations.

Federal Bureaucracy

A large, complex organization composed of appointed officials within the executive branch, responsible for implementing and administering federal laws and policies.

Organizational Structure

The system that outlines how certain activities are directed in order to achieve the goals of an organization, including rules, roles, and responsibilities.