Negative Externalities Occur When One Person's Actions

question 138

Multiple Choice

Negative externalities occur when one person's actions:

• A)cause another person to lose money in a stock-market transaction.
• B)cause his or her employer to lose business.
• C)adversely affect the wellbeing of a bystander (or bystanders) who is (are) not party to a market exchange.
• D)reveal his or her preference for foreign produced goods.

---

Definitions:

Franchising

A method of conducting business where a franchisor licenses trademarks and proven methods of doing business to a franchisee in exchange for a recurring payment, and usually a percentage of gross sales or gross profits.

Market Analysis

The study of the market within an industry, including the analysis of supply and demand, target demographic, and competition.

Franchise

A type of license that grants a franchisee access to a franchisor's proprietary knowledge, processes, and trademarks, allowing them to sell a product or service under the franchisor's business model.

Questions

Inquiries made to seek information or clarity about a particular subject.