An Externality Exists in the Production of a Good or Service

question 45

Multiple Choice

An externality exists in the production of a good or service when:

• A) the marginal cost to society of consuming an extra unit of a good equals the marginal social benefit.
• B) resources are allocated such that no one can be made better off without making someone
• C) the marginal social cost differs from the marginal private cost of production.
• D) markets are allocatively and productively efficient.

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Definitions:

Right-Handed

Preferring to use the right hand for most activities, especially intricate tasks like writing or eating.

Reproduce Drawing

The act of copying or imitating the contents of a drawing, often used in psychological testing or art therapy assessments.

Endocrine System

A collection of glands in the body that secrete hormones directly into the circulatory system to be carried towards distant target organs.

Hormonal System

A complex network of glands and hormones that regulates various functions in the body, including growth, metabolism, and reproduction.