If an Externality Is Present in a Market, Economic Efficiency

question 129

Multiple Choice

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

• A)increased competition.
• B)weakening property rights.
• C)better informed market participants.
• D)government intervention.

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Definitions:

Innovation

The introduction of something new, such as a method, idea, or product, intended to improve efficiency, effectiveness, or competitive advantage.

Competitiveness

The ability of a company or country to achieve and maintain a favorable position in the market compared to others, based on factors like price, quality, and innovation.

Transportation Model

A type of linear programming model used to solve logistics problems, involving the optimization of distributing goods from several suppliers to several consumers in a cost-effective manner.