For Both Public Goods and Common Resources, an Externality Arises

question 21

Multiple Choice

For both public goods and common resources, an externality arises because:

• A)something of value has no price attached to it
• B)the goods are undervalued by society
• C)the social optimum level of output is greater than market equilibrium
• D)all of the above are true

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Definitions:

Bulk Flow

A movement of molecules from an area of higher pressure to an area of lower pressure, typically referring to fluids and gases.

Adenine

A purine nucleobase, one of the four nucleobases in the nucleic acid of DNA and RNA, paired with thymine in DNA and with uracil in RNA.

ATP

Adenosine triphosphate, a molecule that stores and transfers energy within cells, thereby powering a multitude of cellular processes.