Private Markets Fail to Account for Externalities Because

question 155

Multiple Choice

Private markets fail to account for externalities because

• A)externalities don't occur in private markets.
• B)sellers include costs associated with externalities in the price of their product.
• C)decisionmakers in the market fail to include the costs of their behavior to third parties.
• D)the government cannot easily estimate the optimal quantity of pollution.

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Definitions:

Fire Extinguisher

A device containing an agent that can be discharged to suppress or extinguish a fire.

Hazardous Waste

Waste material that can pose a risk to health or the environment when improperly handled.

Nitrile Gloves

A type of protective glove made from synthetic rubber, resistant to oils, fuels, and some chemicals; commonly used in the automotive and medical fields.

Latex Gloves

Elastic and disposable gloves made from natural rubber latex, commonly used for medical procedures and food handling for protection against contamination.