Your Friend Comments That "A Hair Stylist Should Not Have

question 78

Multiple Choice

Your friend comments that "A hair stylist should not have to obtain a cosmetology license." Her statement is an example of what kind of statement?

• A) Uninformed
• B) Biased
• C) Positive
• D) Normative

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Definitions:

Externalities

Economic impacts on bystanders not directly engaged, with potential for both positive and negative outcomes.

Transaction Costs

The expenses incurred when buying or selling goods and services, which can include fees, commissions, and the costs of the time and effort involved in making the transaction.

Coase Theorem

A principle stating that if trade in an externality is possible and there are no transaction costs, bargaining will lead to an efficient outcome regardless of the initial allocation of property rights.

Externalities

Monetary consequences or side effects that touch upon third parties not directly engaged, with potential for both positive or negative outcomes.