When a Market Experiences a Positive Externality

question 255

Multiple Choice

When a market experiences a positive externality,

• A)the demand curve does not reflect the value to society of the good.
• B)too much of the good is being produced.
• C)the government can internalize the externality by imposing a tax on the product.
• D)the private value is greater than the social value.

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Definitions:

Performance Management

The continuous process of identifying, measuring, and developing the performance of individuals and teams and aligning their performance with the strategic goals of the organization.

Staffing Decisions

The process of planning, recruiting, selecting, and positioning employees within an organization to ensure the right person is in the right job.

Contrast Error

A type of appraisal or judgment bias where the evaluation of one person is unduly influenced by the comparison with another that has recently been appraised.

Problem-Solving Approach

A methodical process of identifying a problem, brainstorming solutions, and implementing the most effective resolution.