When Dealing with Consumption Externalities, Government Can Potentially Correct the Market

question 68

Multiple Choice

When dealing with consumption externalities, government can potentially correct the market failure:

• A)only in the case of positive consumption externalities
• B)only in the case of negative consumption externalities
• C)in both the positive and negative cases by inducing market participants to internalise the externality
• D)in neither the positive or negative cases because governments can only correct production externalities

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Definitions:

Samuel Huntington

An American political scientist best known for his analysis of the relationship between civil and military power, and for his Clash of Civilizations theory.

Clash of Civilization

A theory proposing that future conflicts will be between cultural and religious identities, rather than between nation-states.

Liberal Democracy

A form of democracy that emphasizes individual freedoms, rule of law, and a political system with elected representatives.

Surgical Strike

A precise and targeted military attack designed to eliminate specific threats while minimizing collateral damage and civilian casualties.