If a Good That Generates Negative Externalities Were Priced to Take

question 60

Multiple Choice

If a good that generates negative externalities were priced to take these negative externalities into account, then its

• A) price would decrease and its quantity would increase.
• B) quantity would increase, but its price would remain constant.
• C) price would increase and its quantity would decrease.
• D) price would increase, but its quantity would remain constant.

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Definitions:

Monetary Rewards

Financial incentives given to employees in recognition of their work performance, contribution, or achievements.

Nonmonetary Rewards

Nonmonetary rewards consist of benefits provided to employees that do not involve financial compensation, such as recognition or career development opportunities.

Shareholders

Individuals or entities that own shares in a corporation and have an interest in its performance and governance.

Financial Value

The quantifiable worth of an asset, security, or company, often determined by material and tangible factors within markets.