The Social Costs of an Activity Are Greater Than the Private

question 85

Multiple Choice

The social costs of an activity are greater than the private costs of the activity when

• A) a person does not pay all costs associated with a particular resource-using activity.
• B) the internal costs of the resource-using activity are less than the external costs of the activity.
• C) the internal costs of the resource-using activity are positive.
• D) the external costs of the resource-using activity are zero.

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Definitions:

Equity Multiplier

An equity multiplier is a financial ratio that measures the proportion of a company’s total assets financed by its shareholders' equity, demonstrating the degree of financial leverage being used.

M

Typically represents the mean or average in statistical contexts.

Arithmetic Mean

A measure of central tendency calculated by summing all the scores and dividing by the number of scores. See Mean.

Mode

The number that occurs most often in a collection of data.