A Negative Externality Exists When

question 21

Multiple Choice

A negative externality exists when

• A)marginal social costs are less than marginal private costs.
• B)marginal social costs are greater than marginal private costs.
• C)marginal social benefits are less than marginal private benefits.
• D)marginal social benefits are greater than marginal private benefits.
• E)b and c

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Definitions:

Lower-Order Needs

Basic human requirements such as physiological and safety needs that must be satisfied before higher-order needs can be addressed.

Higher-Order Needs

Esteem and self-actualization needs in Maslow’s hierarchy.

Psychological Development

The ongoing growth and change in cognitive, emotional, and social capabilities and processes throughout a person's life.

Deficit Principle

A theory suggesting that a decrease in stimulation or input will cause humans to seek out more stimulation, to overcome the perceived deficit.