Which of the Following Is NOT an Activity That Generates

question 32

Multiple Choice

Which of the following is NOT an activity that generates an externality?

• A) Bob's Service Station dumps used oil in the river.
• B) Bob renovates a run-down house in the neighborhood.
• C) Bob occasionally drives while drunk.
• D) Bob's Service Station donates a car to charity.

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Definitions:

Deductible

The amount an insured person must pay out-of-pocket before the insurance company will cover the remaining costs of a claim.

Medical Bills

Charges for medical services rendered, including hospital stays, doctor consultations, and treatments.

Insurance Premiums

Payments made to an insurance company in exchange for coverage.

Endowment Policy

An insurance policy designed to pay a lump sum after a specific term (on its 'maturity') or upon the death of the policyholder, whichever comes first.