Which of the Following Statements Is (Are) TRUE

question 108

Multiple Choice

Which of the following statements is (are) TRUE?
I. In the face of a positive externality, a perfectly competitive market produces less than the socially optimal quantity of output.
II. If vaccinations generate an external marginal benefit, their marginal social benefit will always exceed their private marginal benefit.
III. In unregulated markets, the presence of negative externalities-but not positive externalities-causes deadweight losses.

• A) I and II
• B) I, II, and III
• C) III
• D) I and III

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Definitions:

Common Carriers

Businesses that offer transportation services to the public under the authority of a regulatory body.

Reward

A benefit, often monetary, given in recognition of one's service, effort, or achievement.

Bailment

A legal relationship in which physical possession of personal property is transferred from one party to another, with the obligation of safekeeping.

Rental Agreement

A legal contract in which one party agrees to rent property owned by another party for a specified time period, often detailing conditions such as payment and use.