A Positive Externality Arises When a Person Engages in an Activity

question 220

Multiple Choice

A positive externality arises when a person engages in an activity that has

• A)an adverse effect on a bystander who is not compensated by the person who causes the effect.
• B)an adverse effect on a bystander who is compensated by the person who causes the effect.
• C)a beneficial effect on a bystander who pays the person who causes the effect.
• D)a beneficial effect on a bystander who does not pay the person who causes the effect.

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Definitions:

Leptin

A hormone produced by adipose (fat) cells that helps to regulate energy balance by inhibiting hunger, thereby reducing food intake and promoting weight loss.

Oxytocin

A hormone and neurotransmitter often referred to as the "love hormone," associated with social bonding, childbirth, and breastfeeding.

Oxytocin

A hormone and neurotransmitter often associated with social bonding, trust, and affection.

Gastrin

A hormone that stimulates secretion of gastric acid by the stomach's parietal cells, aiding in digestion.