The Existence of Externalities Is Due Mainly to the Fact

question 64

Multiple Choice

The existence of externalities is due mainly to the fact that

• A) monopolies tend to produce too little of a good anyway.
• B) the optimal level of pollution is zero.
• C) pollution is not a serious problem.
• D) property rights are poorly defined.

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Definitions:

Diffusion Of Responsibility

A sociopsychological phenomenon whereby a person is less likely to take responsibility for action or inaction when others are present, often used to explain the bystander effect.

Social Loafing

The phenomenon whereby individuals exert less effort to achieve a goal when they work in a group than when they work alone.

Self-fulfilling Prophecy

A forecast that becomes a reality due to the positive feedback loop between someone's belief and actions, either directly or indirectly causing its own fulfillment.

Likert Scale

A psychometric scale commonly used in questionnaires to measure attitudes or opinions, featuring a range of answers from one extreme to another.