If Production of a Good Creates an External Cost, the Amount

question 124

Multiple Choice

If production of a good creates an external cost, the amount of output where the marginal social benefit equals the marginal private cost is

• A) inefficient.
• B) inequitable.
• C) unattainable.
• D) efficient.

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Definitions:

Stockholders' Equity

The ownership interest of shareholders in the net assets of a corporation, represented by the difference between total assets and total liabilities.

Liabilities

Financial obligations or debts that a company owes to others, such as loans, accounts payable, and mortgages.

No-Par Stock

Refers to stocks issued without a specified face value but instead are sold at a price determined by the issuing company.

Credited

Recorded or acknowledged as having received something, often used in financial contexts to indicate an addition to certain accounts.