If a Production Process Causes a Negative Externality, Then the Social

question 37

Multiple Choice

If a production process causes a negative externality, then the social cost of production will be _______ the private cost of production.

• A)larger than
• B)the same as
• C)smaller than
• D)zero, unlike

---

Definitions:

Goodwill

An intangible asset representing the value of a company's brand, customer relationships, and other non-physical assets.

Recovered

Refers to the process of regaining or securing an amount of money, property, or other resource that was previously lost or owed.

Profits

The financial gain obtained when the revenue generated from business activities exceeds the expenses, taxes, and costs involved in sustaining the activity.

Discounted Cash-flow Analysis

A financial model that estimates the value of an investment based on its expected future cash flows, discounted back to their present value.