In Perfectly Competitive Markets There Are No Externalities

question 12

True/False

In perfectly competitive markets there are no externalities. That is, actions of decision-makers on each other's wellbeing do not extend beyond those effects transmitted by prices.

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Definitions:

Utility Function

A mathematical representation that assigns a value to every possible choice to indicate the level of satisfaction or utility that choice provides to a consumer.

Demand

The quantity of a good or service that consumers are willing and able to purchase at a given price over a specified period of time.

Income

Remuneration obtained regularly through employment or investment activities.

Demand

Demand refers to the quantity of a good or service that consumers are willing and able to purchase at various prices during a given time period.