A Consequence of a Negative Externality Is That Social Costs

question 60

Multiple Choice

A consequence of a negative externality is that social costs __________ private costs,and the efficient level of output __________.

• A) equal; does not require any type of government intervention
• B) are less than; requires the government to create a subsidy
• C) are greater than; requires the government to impose a tax
• D) are greater than; requires the government to create a subsidy
• E) are less than; requires the government to impose a tax

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Definitions:

Sum in Controversy

The amount of money at stake in a lawsuit, important for determining the jurisdiction and the applicability of certain court rules.

Trial or Appeal

Legal proceedings where a case is reviewed in court; a trial is the original hearing of a case, while an appeal is a request for a higher court to review a decision.

Mandatory Arbitration

A process stipulated by a contract where parties must resolve their disputes through arbitration rather than through the court system.

Employment Contract

A formal agreement between an employer and employee outlining the terms and conditions of employment.